There are not too many people that have disposable money to simply pay off the amount of a vehicle. Hence, why a car loan is made possible for many people, so they can (in most cases) easily apply for a vehicle loan to help get them in the vehicle that they want to purchase.
What is a Car Loan?
Many mistaken a car loan for a vehicle lease. It is not the same. A car loan from your local dealer is to finance your vehicle payments to purchase a vehicle without paying upfront for the full payment of the vehicle.
The customer will be paying a lender, a lender will happen through the dealership or with a bank. The type of lender will calculate the financing that will determine your bi-weekly or monthly payments towards your vehicle.
The interest of the finance will be calculated within your vehicle payments.
The 4 Easy Steps for Getting a Car Loan
There are 4 steps that are needed to help you get a car loan from the lender within the financing department. The following 4 steps may differ, the steps could increase or decrease in the process depending on the lender or dealership, however, these are most likely going to be included within the financing method.
- Choose Your Vehicle – The Salesperson will be able to help you find a vehicle that is either the one you researched and want, or the one equivalent to what you can afford based on your income. Use your salesperson’s knowledge of vehicles to help you get the desired vehicle.
- Credit Check - Your Credit Score will reflect on the rate that you will pay on for your car loan.
- Car Term Agreement - This is where you will determine the length of the term you will make payments on the car loan. This is how long your payment process will be.
- Finalizing the Paperwork – After you choose your vehicle and have agreed on a payment price it is now time for the Financing Department to work with the internal or external lender to obtain your car loan.
How Long Does It Take to Pay Off a Car Loan?
Your car loan payment will be dependent on what the lender calculates based on your credit score and earnings. To have a lower monthly payment you will need to extend your term. The longer the term, the lower your car loan payment will be each month.
If you have the financial ability to pay more on your car loan, then be sure to speak with your lender (or salesperson) to ensure that your payment is properly processed for your higher payment.
How to Prepare for a Car Loan?
One of the worst feelings in the world is researching a vehicle, finding the one you want and then getting to the dealership and finding out you cannot afford the vehicle you were aiming to drive a way with from the dealership.
Here is how you can prepare yourself for a car loan.
- Check Your Credit Score - There are various sites that allow you to do this for free.
- Your Earnings – Calculate how much you can afford towards a vehicle. Too often, people go after the vehicle they desire and not the vehicle they can truly afford.
- Choose Your Dealership – Find out from your dealership what their financing options include.
- Research a Salesperson – Everything is easier when you can work with someone who understands your goal and will work hard to find a way to make your realistic car of choice become a hassle-free reality. A good Salesperson can be your best ally, choose wisely.
Let’s make your car buying process easier with a car loan that best suits you and can build a simple bridge between the vehicle you want and the vehicle you can afford.
Let your dealership’s salesperson know your car goals, this includes any additional features and the price range you are looking to pay. This information and relationship can help you get the vehicle you need or want off the lot and in your driveway quickly and effortlessly.
