The 204 10 rule is a rule of thumb that states that a car should never have more than 204,000 miles unless it’s a 10 year old vehicle. This rule is based on the idea that if a vehicle is 10 years old, its average mileage of 20,400 per year does not put it at a greater risk for mechanical failure or significantly reduced reliability than a newer model car with fewer miles.
In other words, even if a car has more than 204,000 miles, it can still be reliable as long as it’s 10+ years old. This rule still stands true even with recent advances in car technology, as cars are made to last much longer than they used to.
How much car will I get approved for?
It’s difficult to say how much car you will get approved for without knowing more information about your financial situation. Generally speaking, lenders will want to see that you have a steady income and a good credit score.
Additionally, factors such as your debt-to-income ratio and how big of a down payment you can make will also determine how much car you will get approved for. It’s also important to note that lenders usually want to make sure they are not lending more than a certain percentage of the value of the car you are purchasing.
Ultimately, the best way to find out how much car you can get approved for is to speak with a lender and let them know the specifics of your financial situation. They will then be able to tell you how much car you can be approved for, based on your individual circumstances.
Is the 20 4 10 rule net or gross income?
The 20-4-10 rule relates to auto financing and states that a car buyer should put down at least 20% of the car’s purchase price, finance the car for no more than 4 years, and keep their monthly car loan payment at 10% or less of their gross monthly income.
It does not refer to a particular type of income, so the 20-4-10 rule isn’t specifically related to net or gross income. Regardless, the rule does refer to monthly income so it is important for car buyers to know their gross monthly income in order to follow the 20-4-10 rule.
Financial advisors generally recommend that buyers stick to the 20-4-10 rule rather than stretching their budget in order to buy a more expensive car that is outside their means.
How much would a $40000 car payment be for 72 months?
The car payment for a $40,000 car for 72 months would depend on the interest rate, fees, and other financing costs associated with the loan. Typically with a loan of this size, you can expect to pay between 0-5% in interest.
The lender may also charge other fees and closing costs associated with the loan.
Assuming the lowest interest rate of 0%, a $40,000 car loan over 72 months would have a monthly payment of $555. 56. If the interest rate is higher and other fees applies, you would need to adjust this monthly payment accordingly.
Additionally, the down payment will also have an effect on the amount of the monthly payment. Putting a larger down payment may lower the overall amount due on the loan and in turn, lower the monthly payments.
What credit score do I need for a 40000 car?
The exact credit score you need to qualify for a $40,000 car loan will depend on the lender’s requirements and your individual credit history. Generally, a credit score of 700 or above is considered good and most lenders will require a score of 660 or higher to qualify for a loan.
If your credit score is lower than 660, you may still be able to qualify for a loan but you may have a higher interest rate or may need to make a larger down payment. Lenders may also take into account other factors such as your income, debts and time in business before making a decision.
It’s important to keep in mind that even if you qualify for a loan, you may not be approved if other factors such as your DTI ratio or the total amount of credit you have is too high. It’s best to speak to a lender before applying to determine their requirements and determine what the best option is for you.
How much should I spend on a car if I make $100000?
It depends on a variety of factors, such as your lifestyle, budget, and needs. In general, if you make $100,000, it is recommended to spend no more than 15-20% of your annual before-tax income on a car purchase.
This means that your budget should be no more than $20,000. However, if you are comfortable spending more, the more expensive the car, the higher the quality and features you will get. Ultimately, it comes down to personal preference and your individual financial situation.
When making a car purchase, it is also important to factor in additional costs such as insurance, registration and taxes, and fuel costs. You should also consider the resale value and how long you will be keeping the car.
It is always a good idea to do research and compare different models to find the best car for your budget and needs.
Can I give the car back a day after I purchase it?
No, unfortunately, you cannot give the car back a day after you purchase it. Most states have something known as a “cooling off period,” which is a set period of time after a purchase that you are allowed to change your mind if you no longer want a product or service.
However, this rule generally only applies to purchases of goods, services, or land that have occurred in the home or other place of business. Additionally, the cooling off period usually only lasts a few days to two weeks, so it would not apply to a car being purchased.
Once you purchase the car, you are legally responsible for it, and the title of the vehicle will typically be transferred to you right away. This means that you would not be able to return the car at that point, even if you decided the next day that you no longer wanted it.
Do you have 3 days to change your mind on a car purchase?
Generally, policies vary by dealership when it comes to the timeline for changing your mind on a car purchase. Many dealerships in the U. S. provide a three-day cooling-off period after a car has been purchased, during which the buyer can cancel the sale and sometimes get a refund for any money put down.
This time period is often called the “right of rescission” period.
Some states have enforced laws that require dealerships to offer cooling-off periods after a car purchase. These laws vary from state to state, so you should check with your local regulations to find out if your state enforces a cooling-off period.
In general, you should be aware that you can take back your purchase within three days of signing the contract, if the dealership hasn’t made the car available to you yet.
It’s important to note that a cooling-off period may not cover all parts of the sale, such as taxes and fees. For instance, you may be able to change your mind on the purchase, but you’ll still be responsible for any taxes, registration fees, and/or title fees that you may have already paid.
So make sure you read the fine print before committing to the sale.
In conclusion, you generally have a three-day cooling-off period, provided by your dealership, to change your mind on a car purchase. However, it’s important to understand that this may not cover all parts of the sale, so be sure to read all the paperwork carefully before making any commitments.
What is Dave Ramsey’s rule for buying a car?
Dave Ramsey’s rule for buying a car is to not spend more than 25% of your take-home pay on monthly car payments. He also advises that when you are ready to buy a car you should save enough money to pay for it in cash and avoid taking out a loan.
If you must take out a loan, his advice is to spend no more than 36% of your take-home pay on the car payments. Additionally, he recommends that you purchase a vehicle that is three years old or less and has less than 36,000 miles on it.
He also suggests steering clear of extended warranties since they typically aren’t worth the cost. Finally, he encourages people to shop around at a variety of dealerships or look for private sellers in order to find the best deal.
What is the rule of 20 4 10 in car loan?
The Rule of 20 4 10 is a rule of thumb that you can use when you’re shopping for a car loan. It states that you should limit your car loan amount to no more than 4 times your annual income, and that your total car-related expenses, including your loan payment and insurance, should not exceed 20% of your income.
This rule helps you to ensure that you stay within your budget and don’t overextend yourself financially when buying a new car. It’s important to remember that this rule is just a guideline. Ultimately, you should carefully consider your own financial situation, including your other financial commitments, before agreeing to a loan amount.
Do I have 14 days to return a car?
No, the amount of time you have to return a car depends on the car dealership or renting policy you are working with. Some car dealerships or renting policies have 14 days return policies, while others may have different timeframes such as 30 days or 45 days.
If you are unsure of the return policy or timeframe, it is important to ask the dealership or rental company prior to signing any contracts or agreements.
How many miles can a car have and still be sold as new?
The exact mileage a car can have and still be sold as new can vary by state and dealership, but generally a vehicle cannot have more than 10-20 miles on the odometer and still be considered new. Some states have stricter laws regulating the definition of a “new” car, so it is always best to check with your local dealership to confirm their definition.
Additionally, any vehicle with over 500 miles on the odometer will be classified as “used. ” Some dealerships may make an exception for a car with low mileage, but most dealers will not allow any vehicle with more than 10-20 miles to be classified as “new.