Used Cars: financing, rule of thumb, pymt

Question
QUESTION: How low of a score should one not consider financing so as to not get pimped.

ANSWER: Hello Jerome,
 This is a good question, Lets talk about credit in general. Everyone needs credit, it's what makes the world go around. Everyone needs a home, car and a job. Yes you can pay cash for everything but somewhere along the road you may need credit. There are several ways to build credit, you can go online these days and get all the help you need. when it comes to a car loan, there are always banks that will loan you money no matter what your score is, depends on if you need a car bad enough and can withstand the rules. If someones scores are low from damaged credit or if your scores are low due to lack of credit and they need a car, yes your going to get a nose bleed buying a car but you are going to have to crawl before you walk.the same thing will happen. If you have a 2 year plan it's not so bad. You have to put your feelings aside first. When buying a car with low scores this is how it works. First the dealer takes you monthly income that's verifiable and figures 16% of that, that is the max pymt the lender is going to give you. Then they want to know the max down pymt you can do. Rule of thumb is for each $1000 you put down equals $20 in pymt. With all that info they will tell you what cars fit the numbers. Now, with special finance the banks charge the dealer a fee, not you, but the dealer can only pay the fee out of the gross they make on the deal, so if you see a car for $10000 and the fees are $2500 the dealer is going to sell you the car for $12500. DO NOT let the dealer send your credit application to over 3 banks, this will only bring your scores lower. If someone has to do this, if they will make all the pymts early for 15-18 months and trade in 15-18 mths they will start to build credit. Hope this helps Jerome, if you want more help pls let me know.

---------- FOLLOW-UP ----------

QUESTION:
What do you mean when you say, "Rule of thumb is for each $1000 you put down equals $20 in pymt."?  It looks like you are saying that the more down payment you put down the more you will have to pay monthly but I am sure that you don't mean that.

Answer
Hello Jerome,

  Let's say you make $2500 mthly, the dealer will take 16% of that and qualify you for a $400 mthly pymt for a car. With 0 down pymt you could buy a $15000 car, if you put down $3000 down pymt you could buy a car for $17500 - 18000. I meant it reduces your pymt by $20 mthly.
 That rule of thumb is just so when your doing your shopping and trying to look at cars and figure what you can budget, also it lets the dealer know you know what your talking about.

 I hope that clears it up for you, the page we have to write our answers is a little short sometimes and it gets cramped.