If you’re in the market for a new or used vehicle, then you’ve likely wondered what financing option makes the most sense. With new and used vehicle costs soaring in recent years, you may turn to an auto loan so you can incorporate the vehicle expense into your monthly budget. 

 

Not all auto loans offer the same value for borrowers though. Plus, there’s more to an auto loan than the monthly payment, which means you have multiple factors of consideration as you’re comparing options. Keep in mind the following as shop around:


  • Amount of the loan: What is the maximum amount of borrowing you’re comfortable with? While it may be tempting to take on as much as possible, try borrowing as little as you can or putting more of a down payment towards it, so you end up paying less in interest.
  • APR and interest rate: The annual percentage rate, or APR, is the total interest, plus fees. The lower the APR, the less you’ll pay in interest and fees over the life of the loan. Most vehicle loans offer fixed interest rates, which means the interest rate stays the same throughout the repayment period.
  • Length of the loan: The amount of time you have for paying back the loan is a critical point too, because it impacts your monthly payment. The longer you stretch out the repayment schedule, the lower your monthly payment is–but you can pay more in interest too. It’s a smart idea for you to calculate the total amount you’ll pay for the loan over time, not just each month.
  • Don’t forget other vehicle costs: Our cars, both new and used, come with additional costs beyond the monthly payment. Factor in the other costs you can’t typically roll into the loan, such as registration fees, auto insurance, maintenance, gas, and repairs, so you have a truer understanding of how much a vehicle impacts your budget.

 

When you’re ready to explore your auto financing options, be sure to talk to our lending experts at Space Age Credit Union. Our auto loans offer competitive, fixed-interest rates, with up to 84 months financing available–and up to100 percent financing possible. We also offer vehicle financing for new and used vehicles. Let’s work together to find you the right lending option for a new or used vehicle today.