When buying a car, most people nowadays are already aware of what monthly payment will fit their budget before making a deal. But, this monthly payment mentality is making car buyers lose track of the total cost of the car and the length of time it will take to pay it off.
Some people are trying to get a good deal with lower interest rates with a reasonable monthly payment. But sometimes the loan has a monthly payment that is too high for them. They end up financing for a longer term even it costs them more.
Having a longer should not be an option for you. Why? Check out the several reasons below:
Higher Interest Costs: The longer you choose to finance your car, of course the longer you have to pay for it. Car loan specialists recommend to have a five-year-loan or shorter term than that if your budget allows it. It is true that the longer monthly payment you have, the lower you have to pay but you also have to consider the fact that the finance charges for the loan that has a longer term is twice compared to the loan with a shorter term.
It is easy to be lured by the appeal of the lower monthly payment offered by the longer loan but in the long run, you would pay more interest and add the years you have agreed to extend.
Car Fatigue: We love our cars when they’re brand new but years after years, there’ll come a time that we’ll trade them to newer and trendy cars. The average years people usually trade their cars are approximately 5 to 6 years. If you have a loan with a longer term payment, you only have 2 options: either you pay off the balance of the loan into your next car purchase or wait for another year or 2 to buy a new one. That doesn’t sound so good, right? So, it is better if you have a loan with a short term payment because you will not only get to enjoy the first car you have chosen for years but also you will be able to sell the first car of your choice right away.
Negative Equity: A new car typically depreciates in its first year. At the beginning of a car loan, the buyer owes more than the car is worth and it will get worse if the buyer hasn’t given a large enough down payment.
The time it takes you to owe less than the car is worth and build equity will vary based on the car you bought and how much down payment you have given. But you have to consider also that the longer your car loan, the longer it will take you to build equity. When you have no car equity, you can’t sell the car right away when time comes that you need some money. The buyer will only pay you what the car is worth and not what you owe on it. You will be stuck with the balance of the loan.
Low Resale Value: Resale value is another reason why you should not choose to have longer loan payment terms. The younger the car, the more desirable and valuable it gets in the marketplace. Meaning, a 5-year-old car is sellable than a 7-year-old car. A dealership will give you more money for the younger car and it is a great candidate for the certified pre-owned process in which the dealer will have a more valuable car to sell. This is contrast to the older car.
To sum it all, if you are going to buy a new car and the monthly payments are too high for you, choose another car that has a lower value and within your budget range. Once you have an idea of what you can afford, make sure you get pre-approved before heading out to the dealer. If you are considering in buying a used-car, interest rates are a bit higher but since it costs less, there’s less to finance and payments will be lower.
To have a better understanding regarding this article, send us any of your queries.
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Ah, the Skyline. Against a skyline. Nice.
The Skyline, in our opinion, is the car that made Nissan.
Never mind that it was actually invented by Prince – no, not the ‘Purple Rain’ one, the Japanese car manufacturer, which merged with Nissan in the 1960s. Nissan kept the excellent ‘Skyline’ name – and the somewhat suspect ‘Gloria’, but we digress.
The Skyline nameplate dates all the way back to the late 1950s, but it’s the 1989 R32 Skyline GTR that really put Nissan on the map. Even though there had been quite a few highlights in the range over the years – the original 1969 GTR, for instance, and the R31 GTS-R – the R32 left an indelible mark, both on the road and in motorsport.
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As SUVs have grown more comfortable and more efficient over the years, families and car shoppers in general have demonstrated an increasing preference for the elevated driving position, superior cargo versatility and higher profile of SUVs. Whether it’s the sliding doors and cavernous interior of a minivan or the high-riding nature and available all-wheel drive of an SUV, each of these vehicles is simply more functional as a family car than a traditional sedan.
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The all-new 2018 Range Rover Velar has been revealed, filling the space between the smaller Evoque and larger Sport in the British marque’s line-up, and will land in Australia later this year, in the Summer. Pitched as the “avant garde Range Rover“, the Velar is claimed to offer new levels of refinement and technology for the brand, and is set to go on sale in Europe later this year.
When the Velar goes on sale in Australia, pricing will range from $70,300 to $135,400 before on-road costs. A special ‘First Edition’ variant will also be offered at launch, priced from $167,600 – again before on-road costs are applied.
Although full Australian details are still to be revealed, headline features in the Velar include the debut of the new Touch Pro Duo infotainment system with two high-definition 10-inch touchscreens, along with Matrix Laser-LED headlights, Jaguar and Aston Martin-esque flush deployable door handles, and a minimalistic design approach.
Do you know what it’s like to be the most popular person in the room? What about the most attractive? No, I don’t either, I was just wondering if anyone had felt the way Mazda must feel in Australia at the moment. Everything the Japanese brand has touched of late has turned to gold and one blinding example of that is the 2016 Mazda 3 Maxx.
Positioned as the second most affordable 3 in the range, the Maxx actually pushes our pick of the 3 range – the SP25, based on our launch review – all the way when you sit down and weigh up driving engagement, pricing and specification. In fact, if you’re shopping on a tight budget, and you don’t absolutely need the 2.5-litre engine, the Maxx is without doubt the model we’d recommend. Yes, it is that good.
Standard safety kit was part of the recent revision to standard specification across the range, and as such, blind spot monitoring, rear cross traffic alert and smart city brake support are included. The amount of standard kit you get at this price point is genuinely impressive. Luxury Euro vehicles with stratospheric price points don’t get some of the gear that the 3 Maxx gets standard.
The Maxx is powered by a 2.0-litre, four cylinder petrol engine, which generates 114kW at 6000rpm and 200Nm at 4000rpm and, as tested, features the aforementioned six-speed automatic gearbox. The engine is pretty high tech too, with stop/start and direct injection, all part of Mazda’s SkyActiv-G technology under the bonnet. All petrol Mazda 3 models will drink regular unleaded, although we tend to run 95RON as a matter of course. The ADR fuel consumption claim is 5.8L/100km with the automatic transmission.
External styling is a Mazda 3 strong point and the Maxx is an attractive small hatch. It is part of the reason the 3 is so popular in Australia – we definitely buy vehicles on style in this country. Mazda’s Kodo design language delivers a fluidity in the proportions from front to rear. The signature swooping design cues might eat into second row headroom a little compared to the outgoing model, but there is still room for two adults in the second row. One exterior highlight is the stylish 16-inch alloy wheels, with sensible sidewall tires that add to the driving comfort around town – more on that in a minute.
Controlling the system is beautifully simple via the rotary dial that is mounted within easy reach and is incredibly easy to understand even for first timers. Cleverly, the touchscreen function is deactivated when the Maxx is in motion. The satellite navigation software is quick to load and accurate when directing you to a destination. The audio system works well too, with Bluetooth phone connectivity always crystal clear and never dropping out. You also get DAB+ radio and internet radio integration. The screen displays all you need to work through in an easy to understand fashion.
The driving position, visibility and comfort are all perfect. There’s plenty of seat adjustment for tall occupants even in the passenger seat, but keep in mind, tall adults up front will eat into leg space for passengers in the second row. If the Maxx is a family runaround though, there’s more than enough space to truck the brood around.
The second row seats are actually nicely sculpted and comfortable for adults even on longer trips. You tend to sit down into them rather than up on top of them, and the material is both hardy but comfortable. Your passengers will appreciate the second row accommodation, that’s for sure.
The small console bin and small glove box don’t offer up much space for workers using the Mazda 3 as a mobile office, but there’s safe storage for a wallet and phone ahead of the shifter and the cup holders/bottle holders are well positioned too. The hatch section is low enough to make loading and unloading gear easy and again, there’s enough usable space to haul the kind of gear that most Mazda 3 owners will need to carry.
On the move, the 2.0-litre engine presents – at city speeds at least – as a quiet and refined power plant. It’s only when you lean on the throttle a little heavily, or coax the Maxx willingly up to highway speeds (or roll on overtake from say 60km/h), that it starts to feel like you’d be better off with the 2.5-litre engine. Under all other conditions, the 2.0-litre is more than up to the task. The real world fuel usage reflects the fact that the engine has to work harder than its bigger sibling, returning an indicated 10.3L/100km.
The gearbox is crisp regardless of how hard you’re working the engine, and paired with sharp steering, it makes the Mazda 3 Maxx feel like a nimble little hatch. You find yourself darting around town, like you’re piloting a go-kart, such is the all-round balance and feedback. We loved the way the Maxx rode over poor surfaces, thanks in part to sensible 16-inch wheels and tall tires, but also to an inherently capable suspension tune. While it can turn in sharply and stay balanced through corners, it can also ride comfortably when the going gets nasty – it’s a solid compromise.
As we stated at the outset, the Mazda 3 Maxx really does give the SP25 a red hot run for its money as the overall pick of the 3 range. It’s only piped by the more effective engine and extra inclusions for those buyers not on a tight budget. In Maxx specification though, we reckon the Mazda 3 earns a solid eight overall, such is its all-round ability. It’s not hard to work out why the Mazda 3 is so damn popular with Australian buyers.