Buying this truck or that truck... Buying this truck or that truck...
It is nearly always about the money and none of us want to part with more than necessary
but,
more down payment is nearly always a big, big savings and worth the wait, especially for those just getting started.
In the example below I chose the same year, make and model used truck advertised in the Truck Paper by two different truck dealerships. Both trucks have the same specifications and nearly the same miles. Actually, both trucks came out of the same large fleet.
| terms | dealer 1 | dealer 2 |
| down payment | $999 in ad, very prominent | $5,400 |
| monthly payment | $1,640 | $1,157 |
| term | 39 mo. | 30 mo. |
| Annual Percentage Rate | 16.5% | 10% |
| Purchase Price | not in ad but turned out to be $50,250 | $36,000 |
| Sum of payments + down payment | $64,959 |
$40,110 |
Not only does the buyer of
the $999 down truck pay far too much money in an industry that seldom forgives such
mistakes, the poor fellow will not be in an equity position until the last months of the
loan. Bad, very bad because by that time; the truck will have enough age and
miles on it so that it becomes very difficult to make the payments and keep it maintained,
too. Almost never is there money left over to buy such items as groceries. OK,
I suppose, if you are trying to diet. Not so OK if you have a family to feed.