Auto Loans

Three Things You Need to Do Before Getting a Car Loan

Feb 11, 2020
Woman in caar

 

shutterstock_670223359The ABC’s of Smart Car Financing

What make? Which model? Will you go for a bright color like red, or one that hides the dust? 4-door, 8-cylinder, 5-speed? Contemplating a new (or new to you) car comes with many choices. But before you get your heart set on a specific car, it’s smart to get the financing lined up so you don’t speed ahead to a monthly payment you can’t afford.

Already have an auto loan? You may be able to save money on your monthly loan payments. Turn here to learn more.   

Understand What You Can Afford

Your new car love can turn to regret once the first monthly payment comes due if you don’t do your homework in advance. An affordability calculator, like one of these, is a perfect place to start. Enter the monthly payment you know will work with your budget, and you’ll learn how much car you can afford.

Next, check your credit report and FICO score. Any lender will take these numbers into account in determining your interest rate and down payment. This is also the right time to get any errors on your report corrected.

Still have questions? Talk to a lending expert. They can help you set a budget, understand the pros and cons of various financing options, and give you the confidence you’ve done your homework and can afford that car you’ve been dreaming of.

Get Preapproved

When you walk into a dealership with a preapproval letter, the dealer will know you mean business and are already a qualified buyer. This simplifies the purchase process and keeps you from overspending or making long-term financial decisions without all the information.

For instance, there are specific loan terms that can make your monthly payment more manageable. Did you know some lenders offer terms as long as 84 months? Another bit of fine print to think about: getting a loan with no prepayment penalties is a good choice if you want to pay-off the loan faster.

These are all questions you can get answered upfront with your lending expert, so the terms of the loan on your preapproval letter are exactly what you want.

Shop Around

There’s a difference between the asking price of a car and its actual market value. And you want to be sure the amount you’re borrowing isn’t a mismatch to the value of the car. Sites like Kelley Blue Book or Edmunds can tell you the market value for a car, so you’ll know you’re not being taken for a ride!

Some lenders partner with reputable dealers to save you time, stress, and even money. Did you know rental companies sell their vehicles before they rack up a lot of miles? These well-maintained used cars can be a good option if you want to save you money. Learn more here.

We’ll Help You Navigate

Finex credit union members have the opportunity to get auto loans at very low rates with no prepayment penalties and your choice of terms.

Finex Credit Union auto loans feature:

  • New and used car financing up to 130%
  • Terms as long as 84 months
  • No prepayment penalties            
  • Low rates

Finex Credit Union also teams up with Enterprise Car Sales that offers no-haggle pricing, making it easy to compare and find used cars online with the best possible prices. Find the vehicle you want with ease here.

If you still have questions, or want to get started on preapproval letter, we’re here to help.  Fill out the form below or email us at Help@finexcu.org.