Linearproject Research

Name: Date:Period:

LinearProject Research

You and your team will be working together as Financial Advisors. Financial Advisors help their clients make decisions that involve spending, saving or investing their money. Your client is interested in buying a car and will have to borrow money to pay for it. You will be helping them decide which of 4 different loan options is best for them.

In order for you to help your client, you will need to know something about car loans.

There are four variables to consider when choosing a car loan.

1. The interest rate.

2. The length of the loan, called the term.

3. The cost of the car.

4. The down payment.

Your Research

Go online to 3 different car manufacturer sites. Research the interest rates, loan terms and the amount required for a down payment from each dealer.

Interest Rates

When a person borrows money they are charged interest. The interest they are charged is a percent of the loan amount. Interest rates may be different at different dealers. Go online and find three different interest rates for new cars. Record your findings below.

Dealership:
Interest Rate: / Dealership:
Interest Rate: / Dealership:
Interest Rate:

Loan Term

How long do you have to pay back the loan? This is called term of the loan. If you borrow lunch money from your friend they might want you to pay them back in one day. Most people who borrow money to buy a house have 30 years to pay back the loan. How long do you have to pay back a car loan?

Go online to find out what the term is for car loans. There are several choices. Record three different popular loan terms for new cars.

Dealership:
Loan Term: / Dealership:
Loan Term: / Dealership:
Loan Term:

Cost of the Car

The amount your client will borrow depends on the cost of the car they choose. Go online to research the cost of different cars. Record the price for three different types of cars.

Dealership:
Car Model:
Price: / Dealership:
Car Model:
Price: / Dealership:
Car Model:
Price:

Down Payment

Making a down payment and then paying the rest of the loan off monthly makes an expensive purchase like a car more affordable. Go online to find out how much money different dealers require your client to put “down.” Some car dealers will not require any down payment and will advertise “No money down” Record your findings below.

Dealership:
Down Payment: / Dealership:
Down Payment: / Dealership:
Down Payment:

You will also need know how much your client can afford to pay for a car. They will be making monthly payments to pay back the loan. In order to determine if your client can afford the loan payments, you will have to know what other bills they have to pay every month.

Monthly Bills

Talk to an adult and find out what type of bills and expenses they have to pay every month. You do not have to know how much they have to pay, just a list of what they have to pay for each month. Record your list below.

List of monthly bills/expenses: