What to Look For in an Auto Loan?
A lot rests on a person’s financial situation when looking for a competitive auto loan. As much as it can be a problem for some, most institutions scrupulously look over an applicant’s credit report before making an offer, which can lead to inflated interest rates, high upfront fees, and strict loan conditions. This is why it’s important to know your own credit history before shopping around. With or without good credit, however, there are always ways to secure an auto loan that works for you. To help in this respect, we’ve included the following auto loan considerations.
- Interest: Using a loan amortization calculator, look at your month-to-month expenses and determine the overall cost of the contract. Pay close attention to the annual percentage rate (APR) — the lower the figure, the more money you save.
- Duration: How long do you have to repay the auto loan? Short periods often mean higher monthlies, but long contracts incur more interest over time. Consider a larger down payment to help reduce the cost of a short-term auto loan.
- Penalties: What type of consequences will you face should you miss a payment? Conversely, can you make extra payments without enduring financial repercussions?
- Insurance: Some financers require applicants to obtain insurance before qualifying for an auto loan. For this reason, inquire about available insurance packages and warranties before shopping elsewhere.
- Institution: Credit unions and banks typically approve the least amount of auto loans. Although such institutions offer competitive lending rates, dealership-approved auto loans often come with better incentives; some may even promise lower rates. Trillium Auto Group, for example, guarantees auto loan approval and interest-rate reduction after 12-months.
In regards to the above, always read and reread every clause of an agreement — including the fine print! The more aware you are of the conditions, the better equipped you are to detect hidden unfavourable details. As a consumer, it’s your duty to investigate these things and protect yourself. Knowledge is an asset when shopping for an auto loan. When in doubt, speak with an expert. Luckily, Trillium Auto Group not only employs vehicle salespersons, but credit experts as well. This is just another way Trillium simplifies the process of finding workable auto loans for everyone.