Affordable Auto Loan: How to stay away from an Expensive Car Purchase in New York?

CNBC published a report on America’s most expensive states to live in 2015. And, the New York State is at number 3. Living in the Empire State is to live a royal life. Everything from a house to a cup of coffee will cost a fortune in the state. And, buying a car is expensive in New York as well.

What is the cost of buying a Car in New York?

The cost of buying a new car depends on the make and model that you choose. But, the approximate cost will be the total of the following expenses:

Initial Cost of Owning a Car in New York

>>$33560 - Average price of new car

>>$50 - Title Fee of New York State DMV

>>$25 - License Plate Fee of New York State DMV

>>Other Taxes

Annual Cost of Owning a Car in New York

>>$1196– Average Annual Car Insurance

>>$365 – Repairs

>>$713 – Gas

Now, you cannot reduce the cost related to the New York State DMV fees, insurance or maintenance. But, you can avoid an expensive car purchase by opting for an affordable auto loan in New York.

How to obtain an Affordable Auto Loan in New York State?

Choosing a car is an emotional decision for people. So, it is important that you keep your emotions in check and buy a car that doesn’t put a pressure on your wallet. Here’s how to work towards obtaining an affordable auto loan in New York State:

Spending Plan

You must prepare a spending plan that includes information of your monthly income and expenses. Make a list of your total monthly income that includes income from your job as well as investments. Remember to include all your expenses such as food, rent, utility bills, etc. to your total monthly expense. Once you calculate your monthly income and expense, you will be able to allocate a monthly budget for your car-related expenses.

Monthly Payment

Once you create your spending plan, you will be able to estimate a comfortable monthly payment amount. Make sure that you stick to the comfortable amount because if you opt for a New York auto loan with higher monthly payment amount, you will face financial trouble.

Down Payment

Down payment helps a New York car buyer in the following ways:

1. It reduces the total auto loan amount.

2. It reduces the loan-to-value (LTV) ratio.

3. It manifests a stable financial condition to the lender.

4. It reduces the interest rate.

5. It reduces the chances of an upside down auto loan.

If you are buying a new car in New York State, 20% down payment is ideal. And, if you are interested in a used car, it is okay to have at least 10% down payment.

Trade-in

By opting for a trade-in, you will be able to reduce your total loan amount. The option is ideal for those NY car buyers who do not have adequate down payment.

Before trading your old car for a new one, ascertain the selling price of your old car. If a car buyer is willing to give you a higher price than the dealer, sell it and use the money for down payment.

Buying a car is expensive in New York State. But, if you work hard to make your New York auto loan affordable, you can avoid an expensive car purchase.