Buying a new car

[Recover101]

Is there a huge difference in interest rate on a car loan if I can put down 25%? What about 50%?

[LadyInTheRed]

I don't really know, but I would think paying a higher down payment would decrease the interest rate. I am sure somebody will come along and tell you what they know on the topic. But, the best way to get the correct answer is to ask the lender. If you are applying through the dealer's finance department, I am sure they can tell you the effect of a higher down payment.

[IBroke]

Is there a huge difference in interest rate on a car loan if I can put down 25%? What about 50%?

AFAIK, some lenders (especially credit-unions) offer a discount (somewhere between 0.25 and 0.5%) if your LTV is below 80% or 75%. However, I've yet to see a lender where you can get an additional discount for putting down more than that (like the suggested 50%).

[LadyInTheRed]

Even if you don't get a reduction in the interest rate, the loan will cost a lot less in the long run if you put 50% down instead of 25%.

[IBroke]

Even if you don't get a reduction in the interest rate, the loan will cost a lot less in the long run if you put 50% down instead of 25%.

That's true - although you could also spin this even further and ask the OP if he has other debts (credit-cards, morgage etc.) at a higher interest-rate than the potential new auto-loan. If so, paying that off first saves even more....

[LadyInTheRed]

That's true - although you could also spin this even further and ask the OP if he has other debts (credit-cards, morgage etc.) at a higher interest-rate than the potential new auto-loan. If so, paying that off first saves even more....

Good point.