Auto loans are a big expense for any new car owner, and you want to find the one that offers the lowest APR. If you’re shopping around for an auto loan, there are a few options to consider.
3 things to know about car loans
Buying a car is one of the biggest purchases you make. Unfortunately, car loans can be expensive. If you are looking for the lowest possible APR on your auto loan, here are three things to know about getting a low-interest loan.
Eligible vehicle types and methods of repayment are two of the main factors that determine how much you spend on your car loan. Despite these two main factors, the interest rate is also an important determinant in your final auto loan APR. If you’re looking for a car and want to avoid high interest rates, here are three things to know about car loans that could help you get the lowest rate possible.
Lowest APR Examples
At an auto dealership, the best way to get a low APR for your car loan is to shop around. Be patient and don’t feel pressured to choose one dealer. As of 2015, the average interest rate on a new auto loan was 4.75%. Depending on where you live, this can be much lower than other companies.
It can be stressful to come up with the money for a car purchase without taking out a loan. Luckily, there are ways for you to get the lowest auto loan APR possible. You’ll have to have good financial standing and be able to show that you can make your payments on time. Having certain credit scores will help your chances of getting a low APR.
Is there a waiting period for the lowest APR?
First things first. It’s best to always check the APR information before signing any contract. With that in mind, APRs depend on individual lenders and their respective policies.
Yes, there is a waiting period to get the lowest APR. The waiting period starts when you submit your application for an auto loan and ends after 24-hours.
Should I have a trade in to lower my loan rate?
After reading this blog, you should be able to answer that question for yourself. There are many factors in determining your monthly payments, and it is ultimately up to you which option is best for you.
If you have a car to trade in, you might want to consider it because the new loan rate depends on what type of car your trading in and how much it’s worth. In general, if you sell a car for less than 10% of its fair value, it should lower your loan rate by one or two points.
Which auto loan is for you?
There are many different auto loan options. The best way to figure out which loan is right for you is to take into account the interest rate, total cost, and length of the loan. Some loans offer lower rates, but a longer term or higher cost. A good rule of thumb is to pick the lowest APR option.
The APR is the Annual Percentage Rate which is the amount of interest a loan will cost you. If your credit score is low, a low APR loan may be in your best interest.