The average automobile today is over $36,000, more money than some people make in a year. Mind boggling. And if you’re looking for a sedan, forget it. It’s all SUV’s and trucks out there, which go for even higher prices much of the time.
According to the personal-finance website WalletHub, consumers have taken out $27 billion in auto loan debt in the third quarter of 2018 alone. Another interesting statistic they include on their site is an in-depth analysis of 2019’s Cities that Overspend on Cars.
The site includes a list of some of their key findings from each of the two reports:
Cities that Overspend on Cars
Lake Placid, FL
Rio Grande City, TX
San Juan, TX
Eagle Pass, TX
San Luis, AZ
Cities that Spend the Least on Cars
Mill Valley, CA
Palo Alto, CA
Los Altos, CA
Bloomfield Hills, MI
Chevy Chase, MD
Garden City, NY
Auto Financing Report:
Included in WalletHub’s interesting information, they report that interest rates for new cars are at one of the lowest points in three years. The average new-car loan, they report, is charging 12 percent less interest than the average used-car loan.
In addition, those folks with ‘fair’ credit will spend about four times more (about $6,199) in interest than those with ‘excellent’ credit, over the life of a five-year, $20,000 loan.
The best options for financing a new car, according to WalletHub, remain credit unions, with rates at 17 percent below average. This writer has financed many cars over the years with her credit union, found them to be easy to deal with and offering better percentages than even those loans obtained at dealerships. Manufacturers rates are at 13 percent below average and if you choose to go to your community or small bank, rates are about 10 percent above average.
WalletHub maintains that automobile manufacturers lack transparency when it comes to leasing offers. All the more reason to do your homework if you’re considering leasing. There are often hidden costs. With the average automaker, reports WalletHub, the transparency score is a 4.5 out of ten.
WalletHub offers a free check of your credit scores on their site; a must before applying for a loan. Consumers may also want to take advantage of WalletHub’s Car Payment Calculator to determine a perspective auto-loan payment and what they can afford.
For additional information and videos, go to www.wallethub.com.
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