All posts tagged finance car

It isn’t uncommon for car buyers to ask a lender to finance their purchase. It is rare to have $10,000 or more in available cash, and it may be possible for those with good credit to pay nothing or almost nothing to borrow the money. What are some questions that you should ask before deciding to finance a vehicle purchase?

Is There a Prepayment Penalty?

The first question that you need to ask is if there is a prepayment penalty associated with the loan. If there is, you may not be able to trade or sell your car before the loan has been fully paid or even refinance if better terms become available. For borrowers with good credit getting financed through a national or regional lender, this is generally not an issue.

How Much Interest Do I Pay Throughout the Loan?

Your monthly payment does not accurately reflect how much you actually pay for the car. Instead, you want to know how much interest you will pay over the course of the loan. The longer your loan term, the more you pay because at least a portion of each payment you make includes interest paid to the lender.

How Do I Get Matched With a Lender?

Another good question that you should ask is how you are matched with your lender. In many cases, Markosian Auto or other dealers will have relationships with dozens of lenders that are willing to offer you loan terms. However, you also have the ability to name a lender or lenders that you prefer to work with. In some cases, you may be better off getting quotes from a bank or credit union that you do business with before you even set foot on the dealer lot.

What Happens If I Miss a Payment?

It is important to know what could happen if a payment is late or missed. In some cases, a lender will repossess the car after a single missed payment. Make sure that you have the dealer go over your loan paperwork to ensure that you are clear about you rights and responsibilities as a borrower.

Buying a new or used car can make it easier to get to work, school or wherever else you need to go. However, it is important that you find an affordable way to finance the loan that offers flexibility today and in the future in case your financial circumstances or transportation needs change.