How much are my payments

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I am amazed everytime a person looks at a $20,000 car, with no money down, and can’t believe it does not work out to $200 a month. If I had a dollar for everytime…….

My sales person does a great job. He does an outstanding presentation. The customer is drooling. Then we present numbers and the customer says they will take it for $200 a month. Maybe my salesperson didn’t do such a great job. He should have had that information, making sure he is on the right car. The customer isn’t going to step down to a different model, losing face. They will only leave with their new found information and buy somewhere else.

I teach my salespeople, if they do quote a payment, figure $20 to $25 per every thousand financed for a 60 month term. Now my salesperson needs to be smart enough to know what cars will qualify for what term. To make it easy for you when you are looking at cars here are “money factors” for 4 different terms all at 7.9% .

36 months .0313
48 months .0234
60 months .0202 (here is where I get the $20 per thousand financed)
72 months .0175

For example let’s assume you are financing $15,000

36 months – $15,000 x .0313 equals a payment of $469
48 months – $15,000 x .0234 equals a payment of $365
60 months – $15,000 x .0202 equals a payment of $303
72 months – $15,000 x .0175 equals a payment of $262

Not only does this information help you decide which vehicle fits in your budget, but also you will be able to see if the dealer is being honest with you in his computation of the payments. I always believe having an informed buyer makes the sale easier. They trust me more. They are realistic.

Remember when you get to this point it is only math.

Share and Enjoy:

Jose Escalante

October 5th, 2009 at 11:38 pm

I really needed this

Jose Escalante
http://www.joseescalante.com

Steve Chambers

October 6th, 2009 at 1:21 am

Excellent advice. Most people ignore the math until the last minute and then are amazed at the reality. This really made it simple to understand.

Steve Chambers
Sales Training Speaker

Kate McKeon

October 6th, 2009 at 1:39 am

Well, if you’ve seen textbooks in the past 15 years you can understand why people are so bad at math. We’ve dumbed down the entire country. makes everyone’s job harder when we hav eto carry those would could carry themselves.

Leadership in Education, Kate

Rob Northrup

October 6th, 2009 at 6:15 am

Most people only care about the payments, the car sellers have used this to their advantage by pushing 60 and 72 and even 84 month loans.

Personally I feel that 60 months is the absolute max that anyone should finance, and 36 or 48 is better. The amount of time you are upside down is lower.

Seize the Day,
Rob
Emergency Preparedness For the 21st Century Family