Auto Loans 101 – What are they and how do they work?
For a large majority of car buyers, getting a car loan is part of the process. Whether it is a new $50k SUV or a used car for under $10k, getting financing allows for one to make monthly payments toward the total cost of the car. There are many factors that go into an auto loan – the total price of the car, the loan terms and length, the downpayment amount, and any additional fees. Your credit score also determines what type of loan you can get, although here at Easterns Automotive we are pleased to offer bad credit loans – giving those with not so perfect credit a chance to purchase a car. Read on to get a better understanding of exactly how a car loan works!
How will I know what my monthly payment will be?
A car loan has three primary factors that affect monthly payments.
Loan Amount: This is the amount of money you are borrowing. It includes the cost of the vehicle, but can vary due to what you get for a trade-in and what your are making for a down payment.
APR on the loan: This is the effective interest rate you pay on your loan. It can greatly vary as well.
Loan Term: The final factor is the loan term, which can vary from 36-84 months. This is the amount of time you have to pay back the loan.
At Easterns Automotive, we will always ensure you understand your monthly obligation to your car loan provider. So once all of these factors are taken into account, we can explain to you what your monthly payment will be, and even work towards a target of a certain monthly payment that fits your budget.
I need financing for a used car, what are the next steps?
So, you have determined you are ready to buy your next vehicle, and you know you need financing – how do you get started?
1) Credit score: The first step is to be aware of what your credit is. Everyone has access to view their credit report. If there is anything inaccurate, that is making your score lower, you can report it and have the info corrected.
2) Determine your budget: Getting a new or used vehicle is an exciting event; you should be able to enjoy your big purchase, so it is important to determine a budget that you can handle, and stick to. Don’t forget to consider other costs such as insurance and registration.
3) View inventory: Now you know your general budget, it is time to decide the type of vehicle you want. Consider top priorities, such as passenger space or engine power. View the various inventory and look at specific models that are for sale. At Easterns we have a huge selection of cars, trucks, SUVs, minivans, and more! We are sure to have something for everyone.
4) Get pre-approved: You can apply to get pre-approved for an auto loan right on our website, it’s that easy! Our finance team will go over your application, and get in touch with you in a timely manner. They will let you know how much you are approved for, and the fine details of the vehicle loan.
5) Visit the dealership: Lastly, stop by the dealership to test drive the vehicle you are interested in, go over the final details, and sign the paper work. Make sure you understand all aspects of your loan and vehicle purchase. If you have questions, feel free to ask! The friendly staff at the Easterns dealerships is happy to give you answers.