There are a number of potentially confusing terms to decipher if it is the first time you are seeking car loans in Lynnwood. Not only do you have to determine if you can actually afford the monthly payments on a pre-owned vehicle, you must consider the additional costs that include auto insurance, fuel, routine maintenance services, repairs, tires, etc.
Be sure you know exactly what you are in for before visiting the dealership by understanding the technical lingo:
- Term of the loan – This is the length of your financing and could range from 36-60 months or more. Know that the longer the loan, the smaller your monthly payment but the more interest you will pay.
- APR – The annual percentage rate is the most important factor in considering financing. You should seek the lowest APR possible.
- Auto financing with no credit – Someone buying a vehicle for the first time usually does not have any information on his credit history or “no credit.” A dealer does not know what type of credit risk you may be.
- Down payment – The amount of money you are able to initiate your purchase with is the down payment. A larger down payment is best to lessen the term of your loan.
- Finance charge – This is the amount the lender charges to secure your loan.
- Penalties and extra fees – Know exactly what may happen if you pay off your loan early and additional charges that may be levied.