Guide to Vehicle Financing

Things to consider before you shop

How Will You Use Your Vehicle? 

Think about how you will use your new car. Consider interior space, size, maintenance costs, insurance costs and gas mileage.

Research Vehicles That Fit Your Needs.

Consult reference guides and review sites like Consumer Reports. Test drive the cars you’re interested in. Consult popular websites like Kelly Blue Book and Edmunds for vehicle specifications and fair market values 

Anticipate All Costs

Reference guides will give you MSRPs and current market values, but it’s important to consider other expenses as well. Expenses like fuel costs, registration fees, maintenance, insurance and repairs can all add up. Allow for those unexpected maintenance costs as well.

Financing Considerations

• Interest rate
  Confirm the annual percentage rate (APR) of your loan. Determine if the loan has a fixed rate (monthly payments and rate remain the same) or an adjustable rate (monthly payments and rate can change).
• Total amount financed
  Double check that the amount on your loan documents is the same as what you asked for. Don’t forget to consider your local taxes as well.
• Monthly payments
  Be sure your budget can afford the monthly payments
• Potential penalties
  It’s best to get a loan that has no early repayment penalty clause. You don’t want to pay an extra fee if you are able to repay your loan faster than planned.
• Length of loan
  Car loans generally range from 36 months to 72 months. Longer terms will lower your payments but will cost you more over the life of the loan.

Increase your likelihood of approval

Knowing your credit score before you begin your search for financing is a good idea. It will help you take a realistic approach toward financing your vehicle.