3 Things to Know Before Applying for an Auto Loan

posted in: Blog 0

Today’s market has changed drastically, causing higher prices than in previous years. It can be important to educate yourself about market trends before purchasing a vehicle to determine a good time to apply for an auto loan.

1. Do Your Research

Instead of settling for the first vehicle you like, we recommend researching current and recent market prices to decide whether or not it is in your best interest. If you aren’t satisfied with the selection in your area, try expanding your search a bit. This will not only help you find the best car for you but also the best deal!

2. Set a Budget

Having a clear understanding of which vehicle is the best fit for you will help you establish an appropriate budget. We recommend determining a budget for all monthly expenses before you make your purchase. Consider all factors involved such as car payment, insurance, gas, and other expenses to help you calculate how much you can afford to pay for the vehicle.

3. Understand the Loan Process

Before applying for an auto loan, look at the overall cost of the loan as opposed to just looking at the monthly payment. While a low monthly payment could draw you in with its appeal, you want to avoid financial institutions that may increase the total amount you pay through things such as higher interest rates. In this case, it could end up being less expensive to pay a higher monthly payment and have a shorter loan term. We recommend ensuring you can afford to pay the monthly payments on time.

Whether you are buying a used or new vehicle, Camino Federal Credit Union will work with you to ensure you receive personal support. We want our members to find the right auto loan that serves their needs. To speak with one of our auto loan experts, you can contact us at caminofcu.org or give us a call at 800-835-3400.