Car Loans
A great way to be able to get yourself on the open road. Getting a car loan helps to manage your costs and enables you to purchase a higher quality car that will last longer and be more efficient.
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It doesn’t matter whether you’re looking for a new or used car; by financing it, you help to free up your cash flow. |
Cars depreciate quickly over time, so it’s better to lock in fixed monthly payments for your car than a lump sum up front. |
Budget for the best car loan possible.
With a decent credit history, you’re able to get a great rate; just remember the other costs of a vehicle.
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Insurance costs You’re going to need insurance to protect the car and yourself and in the case of other people being harmed by your car. |
Fuel costs The fuel efficiency can vary from car to car, and with the way prices are, you’ll want to be able to afford one with the best fuel efficiency. |
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There are still costs Ancillary items such as taxes, title changes, registration fees, and even new license plates will come out on top of the price of the car itself. |
Make sure to calculate all payments Build out a budget, and ensure you’ve got enough liquidity and income to cover those recurring monthly payments. |
The features of a car loan
Wondering why you should consider a car loan?
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Up to 100% financing You can finance the entire car without the need for any type of funding up front. This helps with your budget with a fixed monthly payment. |
Great rates Because you’re looking at a collateralized loan, with the car as the asset, you’re able to get much better rates than with an unsecured loan. |
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Easy to process Whether you’re in the dealership or at your local bank, the process is extremely straightforward and requires minimal documentation and a good credit score. |
Length of loan on your terms. Pay on your terms. Most car loans can go up to seven or eight years, and that can still come with a fixed rate and smaller payments. |
Car loan eligibility
Generally, you’ll need to have decent proof of income and show the ability to repay the loan.
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Age Even though 18 is the minimum, you’ll need a strong credit history and a low debt to income ratio. Also, a valid state-issued ID is needed. |
Credit score With a collateralized loan, a high credit score is still needed as an indicator you’ll be able to make the repayments. Minimum around 660 credit score |
Income and references Some places only need your last recent paystubs, while others may need a reference letter from a bank or your job. |
FAQ
Should I get a Car Loan?
Yes, it’s a great way to buy a large ticket item without having to spend a lot of your liquid assets. Just make a point of factoring in all the costs.
Can my interest rates change?
No – Car loans usually come in the fixed-rate format. It’s a better option this way.
Is there a prepayment penalty?
This all depends on the agreement you’ve made with the lender. As this is a semi-safe loan for them, the rates are lower, and that’s their revenue generation. However, they may charge a prepayment penalty.