A car is one of the largest purchases that most people will make, so carefully considering how to pay for one is important. Few people actually go into a dealership and pay for a car with cash. Instead, financing a car is the typical way to make a purchase. Even experienced car shoppers often find financing confusing, however. Here are the answers to some of the questions people typically have about car financing%20458-8880) .
What is required to get an auto loan?
Lenders all have different requirements, but you should expect to need to provide proof of employment and income at a minimum when you apply. The best rates on car loans are reserved for people with excellent credit, but there are lenders who are willing to work with people with blemishes on their credit reports. Keep in mind that the lower your credit score is, the more you should expect to pay in interest. It’s a good idea to check your credit before you apply for a loan%20458-8880) , so you have some idea of where you stand.
How much can and should I borrow?
That depends on a number of factors, including your credit history, your income, and the size of your down payment. A general rule of thumb is that your car payment shouldn’t account for more than 20% of your income, but some people prefer it to be even less than that. Be sure to consider what you can afford to pay now in monthly payments as well as how any future changes to your expenses or income may affect your ability to pay. For instance, if you plan to have a baby soon, you may have less money to devote to a car payment%20458-8880) .
How long do auto loans last?
Loans are available in a variety of lengths. Loans that last for shorter periods of time have higher monthly payments. A loan that lasts for a longer period of time will cost less per month, but you will have to pay more in interest over the life of the loan.
Whatever your budget, the perfect car is waiting for you at Sierra Toyota%20458-8880) in Sierra Vista, AZ. The dealership has a huge collection of new and used cars and a dedicated team to help you find the right deal. To learn more, please call (520) 458-8880.