How Much Will A Car Loan Cost? Here’s What You Need to Know

At Daily Bulb, we help borrowers with lower credit ratings understand this and to that effect, also assist them in making informed decisions on their car purchase as well as in finding the right type of lenders for their specific circumstances.

Understanding Budget Limitations

In some instances borrowers with poor credit, who keep wondering, “How much does a car loan cost per month?” think that they can get vehicles like large sedans or SUVs financed. However, even if such applicants meet the monthly income and down payment criteria stipulated by various lenders to approve applications for such category of vehicles, it is our belief that there is a probability that they can still run into some serious problems later on which can be difficult to negotiate. This is because the rates of interest provided on loans for bad credit situations could be significantly higher.

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AAA survey

If you are one of those who think, “How much will car finance cost me every month? Here’s some interesting piece of news for you. As per a recent survey conducted by the American Automobile Association (AAA), one of the most important factors which influence vehicle costs are fuel charges. The organization has determined average annual fuel costs for cars based on their type and size as mentioned below:

  • Small sedan – 43.3 cents per mile or $6,496 per year
  • Medium sedan – 56.2 cents per mile or $8,436 per year
  • Minivan – 62.0 cents per mile or $9,301 per year
  • Large sedan – 70.2 cents per mile or $10,530 per year
  • 4WD SUV – 73.9 cents per mile or $11,085 per year

Besides, the overall cost of driving a car could also depend on parameters such a depreciation of the car value as well as costs which are likely to get incurred on tires and insurance coverage every year.

Yearly Changes In Operating Costs

Another thing which you must take into account if you are thinking, “How much would a car loan cost me?” is that according to the AAA’s report, the most affordable segment of cars to be owned is the small sedan category. Their depreciation costs were much lower than vehicles belonging to other categories last year. Additionally, because of rising fuel prices, the popularity of small sedans greatly increased. This means it is possible to save hundreds of dollars annually by buying a new or used small car. And as less money will be required to finance them loan can be repaid quickly.

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