Auto Loan Calculator
A type of secured loan is used to buy a vehicle. Payment terms falls between three to seven years. The collateral for the loan is the same vehicle you are buying.
How to use?
Car price: Place here the total amount of the car you will buy.
Down payment amount: The money you have available for the upfront payment.
Loan Amount: The amount you wish to get borrowed
Number of months: The time term for the loan
Annual Interest Rate: The percentage you will pay each year related to interest.
Payment Method: if you will initiate your first payment on the first day you receive the loan or after 30 days.
A BETTER FINANCIAL FUTURE IS POSSIBLE
ENSURE YOU GET THE RIGHT TERM ON YOUR NEXT CAR LOAN
Purchasing a car is a good reason to take on debt. You may want to consider these 3 aspects
Down payment
A strong and high upfront payment reduces the amount needed for the loan and reduces the term and interest charges
Interest rate
Make sure you can get a good interest rate by having a high credit score.
Term
This type of loan falls between 3 to 7 years. Keep in mind the shorter the term the lower would be the total coast.
Car buying tips
Useful information
Normally, too many hard inquiries on your credit report will hurt your credit score. Inquiries happen when you authorize a lender to check your credit. You generally want to avoid too many inquiries within a short time or it can decrease your score.
However, if you’re shopping around for a specific type of loan (including a car loan) then multiple inquiries get grouped and counted as one. This allows you to shop around for the best loan possible. You can apply for multiple loans to compare the rates and terms to choose the right loan for your needs.
You can go to your bank or preferred lender to get pre-approved for an auto loan. The lender will tell you the maximum loan amount you qualify for based on your credit score. You can even receive multiple pre-approvals from different lenders to help you find the best deal.
Getting pre-approved before you shop helps you narrow your search for a new vehicle. You won’t run the risk of falling in love with a car you can’t afford because you already know what you can afford.
Many dealers offer specialized incentives to get car buyers to come in for a test drive. You may see advertisements for zero percent interest, no down payment, or cashback on your purchase. On the surface, these sound like great deals.
However, many dealership-offers end up increasing either the monthly or total cost of purchasing a car (or both). This is another reason that having a pre-approval can be beneficial. You can compare the offers the dealer gives you with a traditional car loan. You can evaluate if something that looks like a great offer really is great for you.
Ideally, you want to take about six months to improve your credit score before you apply for a loan. This will help ensure you get the lowest interest rate and best terms possible.
This includes:
- Reviewing your credit report to make sure there aren’t going to be any unwelcome surprises when the lender runs your credit.
- Disputing any negative items that may be mistaken, which could be damaging your score, so you have the highest score possible when you apply.
- Paying down credit card debt, so high balances don’t hurt your score.
