Breakin down the down Payment

You may find a dealership able to take $500 down, but be savvy. They typically mean $500 PLUS tax, title, tag, fees so you end up in the ballpark of $1500 or more depending on the vehicle's asking price (hence, taxable amount). You'll also find you get crushed on the interest and fees. When Roney Auto Sales tells you our down payment amount, that's the exact down payment.

A friend to the business brought us in her contract with another dealer asking us to help her understand how it is she's paying almost 5 times the selling price and it motivated me to want to elaborate on this frequent question in this blog. When you come to a no credit qualifying dealership (meaning we aren't pulling your credit to finance you) you can expect a few things. Higher interest rates and/or higher down payments and/or higher installments. Our down payments are based on the vehicle's value so they do vary. For example, currently, our lowest down payment is $1800 and our highest is $4500.

The reason why we ask for a higher down is multifaceted. One, it allows us to offer lower payments. Two, we want to collect enough to cover tax, registration, title, tag transfer and fees. This is because the state gets that $ immediately and we do not want to go into the red ink to get a vehicle on the road nor do we want you spending your first few months of the loan digging you out of a hole and crushing you on the back end with interest. In short, the more you put down, the better your payments can be. We do have unique features such as pick up pymts (the first 5-6 payments are higher) and layaway ($200-$500 holds the vehicle, we remove it from the website ads and you can make addtl pymts each week for up to 30 days). We can combine the two features as well, to help get you in the vehicle.

I want to be candid and share another reason we don't offer financing with $500 down. We've been around since the '70s and at this same location now since 1984. What we've learned is STATISTICALLY if a person doesn't have "skin in the game", they are more likely to default on the loan, not take care of the vehicles maintenance, blow up the engine and walk away, etc etc etc. I am not implying one size fits all, I'm simply stating overall, the scales swing statistically towards loan default. This can also apply to customers where someone else is putting up the down payment. It's that easy come, easy go mentality (hey...it ain't my money so whadda I care?!). Again, I'm referring to OUR experience, OUR statistics. However, guidelines are established based on a company's experiences and learnings, plain and simple. This has been our experience and for this reason, you won't see us offering financing with $500 down. You will, however, benefit from our guidelines and practices with better payments, better interest rates. When it's all said and done, less money coming out of your pocket.