Finding the Best Vehicle Loan

Smart steps for car buyers: new or used

Shopping for a new or used car is exciting, but finding a great vehicle loan is just as important. Start by checking your credit score, since lenders use it to decide what interest rate you qualify for. Generally, the higher your score, the lower your rate. Also, pay attention to the loan term. Shorter terms, like 24 month or 36 month loans, tend to have lower interest rates, but possibly higher monthly payments, while longer terms (48, 60 or 72 months) may mean higher rates but lower payments.

The price of the car you choose, the interest rate, and the loan term all work together to determine your monthly payment. For example, a lower-priced car or shorter loan term can reduce your payment, while a higher interest rate will increase it. Before signing any paperwork, make sure to include the loan payment in your monthly budget. That way, you’ll know you can comfortably afford your new ride without stretching your finances too thin.