Am I the only one who’s really ticked about these bi-weekly car payment ads?
It used to be that you bought a new car for, say, $18,000. You did the paper work and ended up with monthly payments of a somewhat manageable $250.
Now, every ad out there is offering payments of $136! $152! $171!
And we, who are used to the monthly payment standard think, wow, that’s bloody cheap! Those lowered interest rates are really making a difference in car payments. Maybe I can afford a new car after all.
BUT WAIT!! Read the fine print.
Those payments are bi-weekly payments. That means you’re making that payment every two weeks. Which means that you’re making at least two extra payments each year – that’s three car payments instead of two, every six months.
I don’t know about you, but that extra $150-$200 payment in a month would really set off my budget.
Be careful. When you’re discussing finances with the salesman, watch how you can’t get him to actually verbally tell you the full price of the car. Nor will he specify the monthly payment. He sticks to his insistence that the payments are a low, low $124. Anyone can afford $124, no?
It’s a sales tactic and nothing else. The idea is to make you think that you can afford the car. And once your heart is set and your mind made up, the reality of the financing won’t matter much.
Multiply your bi-weekly payment by 26 and divide by 12 to get your actual monthly payment – the amount you’ll have to budget for. If that amount fits you budget, then go talk to the guy.
Don’t let him throw numbers at you until you’ve done your homework. His only concern, regardless of what he says to convince you, is whether or not you buy the car.
Not whether or not you can pay for it.