Make car payments on time. Hill says it’s best to make car payments on time and not to defer them. You will have to pay interest on the deferred payments, which will leave you with a balance once you reach the end of your loan.
Do the math. Calculate how much your car is worth and how much you owe on it. If you owe $3,000 on a car you want to trade in, for example, you could end up with a higher car note.
Look beyond the monthly payments. “You could gain thousands of dollars in negative equity by focusing only on how much you can pay monthly,” says Tamara Hill, Internet salesperson for David Maus Toyota in Longwood, Florida. The dealer can always work the numbers to suit your desired payment schedule–don’t fall into that trap! “Your focus should be the entire cost of the car,” says Hill.