It wouldn't be worth it financially and if payment are missed, the lender will repo it and your credit will take a big hit. Your best option is to keep saving up money and buy something private sale that will get you around. I suggest saving at least 3k and go for honda or Toyota.
That can be especially true when your credit isn't great and you need another car. Lucky for you, there are many no-credit dealerships ready to make a deal, and if you have as little as $1000 down, you can get a car. No credit check car dealers aren't hard to find.
Down Payments on Used Cars
Experts suggest that around 10 percent of the used car's total cost is standard for a down payment.
Down payments are often required on auto loans, especially with less-than-perfect credit. If you apply for a car loan from a subprime lender signed up with a special finance dealership, you can expect to need an average down payment on a car of at least $1,000 or 10% of the vehicle's selling price.
A down payment between 10 to 20 percent of the vehicle price is the general recommendation.
Most dealerships will work with you to get a down payment that works for your budget. Cash, personal checks, and debit cards are typically preferred for down payments, although there are times when a credit card may be wiser.
What are acceptable forms of down payment for a car? The most common form of down payment is cash or its equivalent. Most dealerships accept personal checks, money orders, and credit cards. Trading in your current car can also be used as a form of down payment.
There is no true one-size-fits-all answer to how much you need to put down on a vehicle. However, a good rule of thumb when buying a new vehicle is to have your down payment by 20% or more of the total purchase price. If you are buying a used vehicle, you may be able to put 10% down.
Car Loan APRs by Credit Score
Excellent (750 - 850): 2.96 percent for new, 3.68 percent for used. Good (700 - 749): 4.03 percent for new, 5.53 percent for used. Fair (650 - 699): 6.75 percent for new, 10.33 percent for used.
If your credit score isn't good, however, you're typically required to make a down payment of at least $1,000 or 10% of the vehicle's selling price. This varies by lender, and some may accept the lesser amount. On a $20,000 car, that would be up to $2,000 down.
More from Personal Finance:
A near-record 17% of car owners are paying more than $1,000 a month, according to Edmunds, a car shopping site and industry data provider.
It's good practice to make a down payment of at least 20% on a new car (10% for used). A larger down payment can also help you nab a better interest rate. But how much a down payment should be for a car isn't black and white. If you can't afford 10% or 20%, the best down payment is the one you can afford.
Upfront Cost: The most obvious downside is the initial out-of-pocket expense. Leasing is often attractive because it requires less money upfront compared to buying. A significant down payment can negate this advantage.
As a general rule, you should pay 20 percent of the price of the vehicle as a down payment. That's because vehicles lose value, or depreciate, rapidly.
And if you are approved, you may qualify for financing with better terms and a lower interest rate. In fact, some lenders require a down payment of 10% or $1,000, whichever is the lower amount, for car buyers with no credit or a low credit score.
While lenders might require putting down at least 10% on a used car, a 20% down payment is still a good practice if it fits in your budget.
The rule is this: The purchase price of a vehicle (taxes included), shouldn't exceed $1500 per year, when averaged over the number of years you own the vehicle. The rule applies regardless of vehicle type (car, truck, SUV), or whether it's new or used.
How much should you put down on a car? One rule of thumb for a down payment on a car is at least 20% of the car's price for new cars and 10% for used — and more if you can afford it. These common recommendations have to do with the car's depreciation and how car loans work.
Trading in your old vehicle, if you have one, could help lower the amount you need to finance with a zero down payment car loan. The trade-in value of your old car essentially works to lower your financed amount in much the same way as a down payment would, without any upfront cash required from you.
Down payments can be in the form of a trade-in vehicle, cash, check, or debit/credit card.
Another option may be to get a family member or friend with a strong credit score to cosign the loan. If you have poor credit, having a cosigner can help you get a car with no down payment and with potentially lower interest rates.
You'll pay far more for your car if you ask to pay for it all upfront with cash. That's because the dealership will not be willing to negotiate as much on the front-end of the car deal since you will not become a sales opportunity for the back-end of the deal (aka in the F&I office).