Paying an unnecessary amount on your car payments can be a detriment to anyone’s monthly budget.
Perhaps you’ve reached a point where you can’t afford the payments with your current financial situation.
Maybe you’re just sick and tired of paying more than needed and want to look at different options for lowering that monthly amount.
Whatever your need is, considering your options starts with knowing what all of those options are and how you can capitalize on them.
Here are several pointers on how to lower your car payment to give yourself some much-needed wiggle room on your finances.
Refinance Your Auto Loan
Sadly, there are many people out there struggling to pay their monthly car payments that don’t realize refinancing is even an option.
This option is great for those of you looking to switch up the length of your loan to match up with your budget.
You can either shorten or lengthen your loan to meet some of the financial goals that you have for yourself.
For example, if you need to lower your monthly payments, then lengthening the loan can help you do so. But if you want to pay off the auto loan that much faster, you have that option as well.
Refinancing can also help you take back control of the institution you’re paying the car payment. So if your personal preference is to have the loan under your primary bank, then that can be arranged.
Be sure to look at several different options for refinancing your auto loan to give yourself a better opportunity for success.
Buy A Used Car
Are you still currently shopping around for cars and looking for the magic secret to getting a lower car payment? If so, then heed this advice: buy a used car.
Some people have the misinterpretation that a “used car” implies buying a vehicle that’s outdated, rusty, and still has audiotapes in its center console.
However, the used cars these days are merely taking advantage of car depreciation, and turning it in your favor.
When you drive a brand-spanking-new car off of the car lot, it loses at least 10 percent of its total value in the first month.
So, instead of being the one that buys the car new and loses money on it, why not be the next guy/girl in line for that same car and buy it at least 10 percent less than what you would’ve paid to buy it new? You’d save a lot of money that way.
For example, say you’re interested in a car that costs $30,000 to buy its newest year and model. By purchasing that same car used, you’d save at least $3,000 (10 percent) off of it.
So spread that $3,000 in savings over a 60-month auto loan, and you’ll be saving $50 a month of your car payment.
With that kind of math to put it into perspective, it’s no wonder that more and more people are going the used car route!
Talk It Over With Your Lender
In this difficult time, lenders should understand that we are all human and that sometimes life happens and you need to adjust things.
Because of that, you need to talk out your current struggles with your payments to the lender.
They might be able to lower your payments for a few months to help you out or even put the payments on hold for the time being.
There are many solutions that you might be able to reach, but only if you ask. If you don’t bring your frustrations or struggles to them, then they’ll assume all is well and continue to charge you the same amount.
Shop Around For Different Deals
One of the most significant ways to save money on your car loan is to be proactive in searching for the right one from the get-go. If you’re shopping for a car, don’t make the mistake of having the dealership research all the deals.
Those dealerships have their quota to meet so that they will put your needs on the backburner.
You can find the right deal by merely shopping for auto loans on your own, and getting pre-approved for one before walking into the dealership.
This will also keep you accountable for staying within your budget, and will prevent the car dealers from trying to oversell you (to a point).
Perhaps you bit off more than you could chew with the car you recently purchased. It’s nothing to be ashamed of, and everyone does it.
Fortunately, you will always have the option of trading down into a car that will cost you less.
Many sites will give you firm offers on your current car, giving you a budget to shop around with for your next vehicle.
This will help you take back control of the payments that you have, rather than letting them dictate your budget each month.
Now You Know How to Lower Your Car Payment!
Now that you know how to lower your car payment, it’s time to use these tips and tricks to your advantage! Be sure to read this article on finding the right auto loans from the get-go to avoid setting yourself back.