What's a Average Down Payment On Cars?

When shopping for a new or used vehicle the thought of a down payment will always be present. Should you offer a large amount, a smaller amount, or go the route of a financing a car with zero down? Questions like this is one reason why people eventually surrender to the idea of finding out the average down payment needed to purchase a car.


This is a very important question as there are many benefits and losses to making a big or small down payments. By offering a auto loan company a good amount of money down customers can expect great interest rates, along with lower monthly payments that can help you save money.

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Offering 20% as an Average Down Payment

According to numerous auto finance specialist, the average down payment amount is around 20 percent of the sales price for those who can afford it. Customers who able to put this much money down make it much easier to handle the follwing circumstances:

Of course the money down amount can definitely vary depending on whether you're in the market for a new or pre-owned vehicle, but this average amount tends to hold the most benefits with few disadvantages.

Upside Down on Car Loans

The worst place anyone can be is upside down on any type of loan, and car buyers can easily fall into this situation if they are not careful. Often times when customers offer small down payments or apply for car loans with no money down they fail to account for deprecation of a vehicle can occur. This then leads to most automobiles, both new and used, to suffer losses in their overall value once they leave the lot.

Owners who offer less than 20 percent down of their auto loan eventually place themselves in a position where they will be paying monthly payments that does not match the value of their car. Therefore, this person is now upside down and may have to look into refinancing options to have a good chance of receiving better interest rates.

Stay Within Your Budget

Now the threat of making very costly payments or being upside down on your car loan is enough to push people to offer 20 percent of the sales price as the down payment, but not everyone can afford such an amount. That is why it's important to stay within your budget and shop for good deals on automobiles. On one hand this can mean choosing a cheaper used vehicle or negotiating with a dealer to only offer a 10 percent down payment, which can still offer you better interest rates.

The last thing that you want to do is go outside of your financial barriers and overspend on a down payment. There plenty of financing situations that lenders like AutoNet Financial can offer that won't require you to break the bank. All you have to do is fill out our online application and qualify for affordable car loan with a modest down payment in minutes.

AutoNet Financial is different than most online bad credit car loan companies as we offer free auto loans and credit services.