How Much Should I Put Down On A $40,000 Car?

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Automotive Content Editor

Meghan Carbary has been writing professionally for nearly 20 years. A published journalist in three states, Meghan honed her skills as a feature writer and sports editor. She has now expanded her skill-set into the automotive industry as a content writer for Auto Credit Express, where she contributes to several automotive and auto finance blogs.


, Automotive Content Editor - February 2, 2022

The amount you put down on a $40,000 vehicle depends on a few different factors, such as the lender you're working with and your credit score. Depending on your priorities, the down payment amount on a $40,000 car can impact your monthly payment and overall cost. Let's look at some down payment recommendations for buying a car and why they're important.

What's a good down payment on a $40,000 car? The minimum down payment requirement for a borrower with a low credit score is typically around $1,000 or 10% of the vehicle's selling price. Whether you have this choice is up to the lender. If you have good credit and aren't required to put down a specific amount, the recommendation is to make a down payment of at least 20% on a new car, and 10% for a used one.

Imagine you're looking at a new 2022 Honda Passport, which starts at an MSRP of around $39,095. If you're following the recommendation of 20% down, you're looking at a down payment of at least $7,818 based on the MSRP alone.

In contrast, a used 2017 Lexus RX selling for around $39,900 may not require as much down if you're not required to put down a certain amount by the lender. A 10% down payment on this vehicle would be $3,990.

When it comes to making a down payment on an auto loan, the amount you put down usually depends on your lender requirement, the amount of the vehicle, and your credit score. If you're buying a car with a good credit score, you may not have to meet strict down payment requirements, though one is usually required when you have bad credit.

Why make a down payment? Even if you aren't required to make a down payment, it's in your best interest as a borrower to do so. This is because the more you're able to put down, the less you have to borrow. In some cases, a lower loan amount may open up better rates and terms on your car loan.

How CarsDirect can help. If you're in the market for an auto loan, but bad credit is making it difficult to find a lender we want to help. At CarsDirect, we work with a nationwide network of special finance dealerships that have the lenders to work with credit-challenged borrowers. Get started toward your next car loan by filling out our no-obligation auto loan request form.

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, Automotive Content Editor

Meghan Carbary has been writing professionally for nearly 20 years. A published journalist in three states, Meghan honed her skills as a feature writer and sports editor. She has now expanded her skill-set into the automotive industry as a content writer for Auto Credit Express, where she contributes to several automotive and auto finance blogs.


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