Financing a Car Answers

Christopher has just made the final monthly payment necessary to pay off his car financing. The car had a list price of $25,995. He made a down payment of $2,434. Additionally, there was a $1,626 vehicle registration fee and a $275 documentation fee. He also paid sales tax of 8.44% on the cost of the vehicle. He included the taxes and fees with the purchase price of the car in a four-year finance agreement with an interest rate of 11.10%, compounded monthly. After completing payment of the four-year loan, what was the total amount of money that Christopher paid for his car? Round to the nearest dollar.

Charles is going to purchase a new car that has a list price of $21,450. He is planning on trading in his good-condition 2004 Dodge Neon and financing the rest of the cost over three years, paying monthly. His finance plan has an interest rate of 12.28%, compounded monthly. Charles will also be responsible for 6.88% sales tax, a $1,089 vehicle registration fee, and a $124 documentation fee. If the dealer gives Charles 80% of the listed trade-in price on his car, once the financing is paid off, what percent of the total amount paid will the interest be? (Consider the trade-in to be a reduction in the amount paid.) Dodge Cars in Good ConditionModel/Year20042005200620072008Viper$7,068$7,225$7,626$7,901$8,116Neon$6,591$6,777$6,822$7,191$7,440Intrepid$8,285$8,579$8,699$9,030$9,121Dakota$7,578$7,763$7,945$8,313$8,581

Reg has just purchased a new car. The car had a list price of $22,499, and he was responsible for 7.96% sales tax, a $2,138 vehicle registration fee, and a $262 documentation fee. Reg’s financing has an interest rate of 10.27%, compounded monthly, and a duration of three years. If Reg makes a monthly payment of $773.89, which of the following was his down payment? Round all dollar values to the nearest cent. (Note: The sales tax is applied to the full list price of the car as there is no trade-in or discount)

Suzanne has purchased a car with a list price of $23,860. She traded in her previous car, which was a Dodge in good condition, and financed the rest of the cost for five years at a rate of 11.62%, compounded monthly. The dealer gave her 85% of the listed trade-in price for her car. She was also responsible for 8.11% sales tax, a $1,695 vehicle registration fee, and a $228 documentation fee. If Suzanne makes a monthly payment of $455.96, which of the following was her original car?Dodge Cars in Good ConditionModel/Year20042005200620072008Viper$7,068$7,225$7,626$7,901$8,116Neon$6,591$6,777$6,822$7,191$7,440Intrepid$8,285$8,579$8,699$9,030$9,121Dakota$7,578$7,763$7,945$8,313$8,581

Reg has just purchased a new car. The car had a list price of $22,499, and he was responsible for 7.96% sales tax, a $2,138 vehicle registration fee, and a $262 documentation fee. Reg’s financing has an interest rate of 10.27%, compounded monthly, and a duration of three years. If Reg makes a monthly payment of $773.89, which of the following was his down payment? Round all dollar values to the nearest cent. (Note: The sales tax is applied to the full list price of the car as there is no trade-in or discount)

Tyler is planning to buy a new car. He intends to trade in his existing car, a 2002 Chrysler Sebring in good condition. Using the table below, estimate how much Tyler’s car is worth.Chrysler Cars in Good ConditionModel/Year20002001200220032004Pacifica$2,194$2,288$2,605$2,690$2,814Concorde$1,842$1,998$2,180$2,781$2,925Sebring$2,920$3,075$3,260$3,551$3,912300M$2,770$2,934$3,095$3,188$3,676

Why is the APR considered the most important factor to be mindful of in a car loan?

The following table shows a portion of a three-year amortization schedule. Use the information in the table to decide which of the following statements is true.