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New Car Loan
Explanation:
New car loans typically have lower interest rates and longer terms than their used counterparts because new cars will theoretically have enough trade-in value for the lender to recoup amounts owed to him if a borrower defaults on his obligations, while used car loan risk must be mitigated upfront.
Different institutions -- including banks, credit unions, and the financing arms of dealerships themselves-- offer new car loans, and it's a good idea to compare rates from all of them in order to find the best deal.
Our Thoughts:
Prior to shopping for a car, it's important that you determine how big of a down payment you can make as well as how much you can afford to pay per month, which will dictate how much you'll need to borrow as well as what type of car is in your price range. You should then garner pre-approval for a loan. With a loan offer in hand, you'll be less susceptible to common dealer tricks like offering to sell a car for less, while simultaneously increasing the interest rate on financing to make the purchase effectively more expensive.