How Does Financing A Car Work?

Congratulations! You’ve decided to upgrade your commute around Stratham, Portsmouth, and Exeter, New Hampshire, by purchasing a new BMW vehicle. But now that you’ve found the right model, what comes next?

We here at BMW of Stratham are strong believers in providing as much information as possible. That’s why we’ve created this guide with a 5-step financing process. Curious to learn more? Let’s get started!

Cell phone on a table with a magnifying glass

1). Determine What You Can Spend

Before you can purchase a car, you have to know what you can comfortably spend on your monthly payments. It’s generally recommended that you spend no more than 20% of your monthly income on car payments.

One fast way you can determine what you can comfortably spend per month on payments is by using a payment calculator tool.

Simply add in the cost of the vehicle and add your specific down payment amount, loan term, trade-in value, and more. In a matter of seconds, you’ll be presented with a customized payment estimator. From there, you can see where it stands and compare it to the 20% rule.

2). Calculate Your Down Payment

Another thing you need to take into consideration when you’re financing a car is how much of a down payment you’ll be putting down. It’s recommended to put down a 20% down payment.

The more or less you put down on your BMW car will affect your monthly payment cost.

3). Decide Which Financing Option is Right for You

When you’re looking to upgrade your ride with a BMW, you have the option of either buying or leasing the vehicle. Both offer you several benefits. Let’s take a look:


Buying means that you are paying the full value of the car, typically over the course of a loan. There are no mileage or time limits since the car is yours.


Leasing means that you drive a BMW for a period of time, usually two to five years, before returning it to the dealership. The upside to this is that you may pay less per month since you’re only paying the depreciation cost.

4). Consider a Co-Signed Loan

If you’re new to credit, you may want to consider having someone co-sign your automotive loan. This means that someone with a good credit standing is taking equal responsibility for your automotive loan. This can help you secure a loan with a potentially lower interest rate.

5). Finalize Your Plan

Now, the only thing standing between you and the open roads in your new BMW vehicle is a final meeting with one of our expert financers. You’ll meet one-on-one to answer any questions you may have about the financing process.

During this meeting, they’ll also do one final run-through on all of your financing options before they craft a completely customized financial plan. After signing your name, you’ll be heading off our dealership lot with your new financing plan in hand.

How Does Financing A Car Work?

Learn More Today

Are you ready to take the first step to cruise around Stratham, Portsmouth, and Exeter, NH, in the perfect BMW for you? Do you want to learn more about your financing options or take a closer look at how financing a car works? If so, don’t hesitate to visit our dealership.

Our team of experts is standing by to help you any way they can. What are you waiting for? Visit us at BMW of Stratham to learn more today!

BMW of Stratham 43.0109042, -70.9188738.