Unless you are talking about leasing, it all depends on how much you finance, the term limit, and your interest rate. After I put down close to $4,750, I'm going to finance $20,000 for 60 months. This would be for a FWD EX CVT, about $200 in dealer add ons, and then Texas Tax, Title, and Licence.
Here are some different payments using that amount:
0.9% - $341
1.9% - $350
2.9% - $359
3.9% - $367
4.9% - $377
Dealers call shoppers like you "payment buyers" and they love you! Becoming fixated on monthly payment allows them to wreak all kinds of havoc with selling price, interest rate, loan term, trade-in value, etc.
I think I got a really, really good deal. I went into the dealer with two number in mind first the MRSP and the Buyout amount and an attitude that I could take the HR-V or leave it.
The MRSP - Buyout amount is the amount your financing in a lease. So in Ontario the MRSP on the EX AWD was $26,700 - $13200 (approx) residual value. So I'm "financing $13,500 over 48 months = $293 per month.
I put down $4k so for me the calculation was $26,700 - $4000 = $22,700 less residual value of $13,200 = $9500 financed over 48 months @ 1.99% = $232.00 per month + Warranty + freight and PDi + tax on downpayment my payment ended up just under $300.00 per month.
If you work the same numbers on build a honda on the canadian website it says $323 a month, but usually it's hard to hit those numbers (huge resistance and lots of excuses at the dealers), but I managed to get quite a bit lower.
Putting a down payment on a lease? So you saved yourself $80 or so a month in the long term but cost yourself $4000 all at once?
I guess, hypothetically, if I was to put money into a leased vehicle I would have paid for the warranty, freight, pdi and such up front and not build it into the lease on the payment. Because I think whatever you add into the lease all gets 1.99% interest on it yes?
Negotiated cost of car
Down payment
Sales tax
APR for financing
How long the term is (36 months, 60 months, etc.)
First rule of car buying: get pre-approved for a loan - or at the very least know your credit score - before going to the dealer. They make money off financing and usually pad the APR a bit (e.g. you qualify for 1.9% but they may tell you 2.5%).
Second rule of car buying: Negotiate from the CAR PRICE first. The dealers are tricky and can do a lot of things to make a car fit your "monthly payment," and will usually screw you over in the process.
Watch out if you start negotiating a monthly payment. A few dollars a month might not seem like much, but it'll cost a lot more in the end.
Also, don't get that terrible extended warranty. Of all the Honda's my family and I have had in the past, 99% of the issues covered under an extended warranty didn't even occur till we were at around 150/160,000 miles. The only car I've ever used an extended warranty on was my Mini Cooper S. But it was German, with a turbocharger, and was driven on city streets all day.
This is good advice, though I'll admit to having purchased the extended warranty. I got them to match the prices that the online sellers of Honda Care charge. It was 10 year/120k miles for about ~$1300, no deductible at my local dealer. Totally unnecessary and completely ignores my own rule for insurance and warranty which is: "The insurance companies are in the business of making money. Self-insure anything you can afford to self-insure." (And we're good about keeping an emergency fund for unexpected repairs, etc.) But to be honest, I've never had a car with anywhere near this much gadgetry, and decided it was worth the markup for peace of mind that a camera or a touch screen would crap out within the next decade. We'll see, and I'll happily not to have use it!
Though I will add on the warranty end- if you are planning to keep the car forever, some dealers offer an unlimited mileage - life of the car, bumper to bumper warranty.
I didn't do it- but if you think you'll keep it forever, that's pretty cheap peace of mind on all the electrics, etc
Usually the stipulation is that you must get all service done at the dealership, and you cannot miss THEIR service intervals, even by a day. The dealer next to me "requires" oil changes every 5k miles or 6 months, whichever comes first. Total bs.
Over that 5 years you are paying $17,640.
Your age definitely comes into play for the interest rate. Did you include the tax, title, license and fees in the deal? Because you are paying interest on all of it. Depending what accessories you got, you are paying $4000-$5000 more than the sticker price + delivery fee of $24,095
But it really isn't, at least if you are fortunate enough to have good credit. The average market return on even a conservative ETF for the financed period would return a significant savings due to time value of money.
I don't see the problem with negotiating to a monthly payment if you keep an eye on what they are doing to get that monthly payment. The problem I am having is that I have good numbers on the price of the car, but the crap they add is upping the payment. It's like they offer a good car price, but then get you back with the "fees." I've currently walked away from CRV negotiations because they refuse to cut the padding, but they aren't backing down. They won't even meet me half way. It's "Our numbers and whatever color we happen to have on the lot or the highway." After the HRV I planned on went missing and they won't deal on the CRV, I'm getting the message that a Honda is not in the cards this time around.
There are 5 or 6 Honda dealers within my driving range. No HRVs, and I need a car by the end of January when the current ride won't pass inspection without a major repair. I have been in touch with all of them with my CRV lease "proposal." Several did not respond, 3 did respond with pretty much the same lease numbers, way higher than any lease calculator I can find. When I explain my math, which is based on a MF and residual value given to me buy a Honda dealer I get crickets or "I don't know where you got your numbers." I let it go a week and then resigned myself to this being the best deal I was going to get and they pulled the "pay us to find the color we knew you want" routine. That's when I contacted another brand's dealer and still got the same highish numbers for a similarly priced car, but at least I don't have to pay extra for the color I want, the car's a 2016, so I'll just wait. Nothing's final, though.
Well, for future reference, I would let them offer a price first and go from there. Maybe you can score a good deal on a Rav4 since the refreshed model should be coming soon (I hear November-December)?
Actually, I didn't pay Freight and PDI at all and my payment is closer to $285 I did purchase the warranty though which was about $600 for the 4 years.
I received 2.39% & my credit score is over 850. Honda didn't have any lower rates with the HR-V. Not bad, not great either. I did a loan for 48 months @ $350.00 a month. I'll have it paid-off in 36 months or less.