When you apply for Hyundai financing, you’ll need to prepare a budget to help you afford the Hyundai vehicle you want. You can simplify this process by following the 20/4/10 rule. Route 1 Hyundai has prepared this guide about what this rule entails.
20 Percent Down Payment
One of the first factors to prioritize when using the 20/4/10 rule is the down payment for your Hyundai vehicle. The amount of money you put down when purchasing your vehicle can help you lower your monthly payments and interest and reduce negative equity. We recommend making a down payment of 20 percent of your vehicle’s value.
Four-Year Loan Term
The length of your loan term helps determine your vehicle's monthly payment and annual percentage rate. Opting for a longer loan term can lower your monthly payments, but will also increase your interest rate. The 20/4/10 rule recommends making monthly payments over a four-year loan term. That’s not always possible with an auto loan, but doing your best to stay close to that term can benefit you in the long run.
10 Percent of Your Gross Monthly Income
When you finance a Hyundai vehicle, the 20/4/10 rule recommends that your total transportation costs shouldn’t exceed 10 percent of your gross monthly income. This factor includes more than just the monthly payment for your Hyundai vehicle’s loan. It also calculates other ownership expenses, such as routine maintenance, insurance, and fuel. This can help you balance your budget so you can afford your vehicle without overshadowing other expenses, such as housing payments, utilities, and groceries.
Explore Our Hyundai Financing Options in Monmouth Junction, NJ
By using the 20/4/10 rule, you can prepare a Hyundai financing plan that suits you. Stop by our Hyundai dealership in Monmouth Junction, NJ, to speak with our finance specialists and start your application. We look forward to meeting with you.
