auto loans presentation
Marissa Swanson
Created on November 17, 2023
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Transcript
Start
Auto loans
Marissa Swanson
Down Payment
Paid to the lender before taking out the loan. Goes towards car purchase.
Principal
Amount you borrow to buy the car, NOT including intrerest and other fees.
Annual Percentage Rate (APR)
Total cost of the loan including the interest rate and other fees. Presented as an annual percentage yearly.A high APR is around 8% A low APR is arond 2%
Interest Rate
Annual fee to borrow money. Can increase, usually paid monthly along with payments on the loan.
Key terms
To buy a car, you must have money to finance it. An auto loan is money you borrow to pay for the car. There are many different kinds of loans, but with any kind, you will repay the loan in installments over an agreed-upon period, with interest.
What is an auto loan
Payments towards the loan generally begin anywhere from 30-90 days after purchase
Dealer financing is a loan taken out from the car dealer. This is a frequently used option. If your credit is good, a dealer financing loan may result in a manufacturer discount on the vehicle. Banks or credit unions often have a minimum and maximum amount... know what your future car costs before taking out the loan. Bank or credit union loans may take up to a week to obtain.
A larger down payment results in cheaper monthly payments.
Loans can be taken out from a bank, credit union, online lenders, and dealer financing...
Repayment typically spans over 2-7 years. A shorter period = less interest rates paid over the loan term. A longer period = larger amount of interest paid over the loan term.
Higher interest rates will apply if the loan is set for a longer than usual repayment period.
If you have a higher credit score, the interest rate can be lower. It also helps determine the amount you can borrow.
How do auto loans work?
Depending on where you get your loan from will determine when to get the loan. Check out your future vehicle prior to purchase to know your necessary loan amount.
Online lenders typically have a similar timeline to banks or credit unions.
Banks or credit unions take anywhere from a day to a week to obtain the loan.
With dealer financing, you set the loan term at the time of purchase.
when to get an auto loan
Pre-owned cars typically have a higher APR than new car loans. Pre-owned car loans are easier to be approved for based on credit scores.
pre-owned car loans
A larger down payment decreases your monthly loan repayments and may allow you to pay off the loan faster, therefore lower interest overall. If your credit is poor, saving up for a large downpayment is a smart decision to save money in the long run.
always remember.....
Motor Presentation
MarketWatch GUIDES
MarketWatch GUIDES
How to Finance a Car
Jovia Federal Credit Union
Auto Loan Calculator
Consumer Financial Protection Bureau
Baton Rough Telco Federal Credit Union
FAQ about Auto Loans
Negotiating an Auto Loan
Best Auto Loan Lenders
What's a good APR?
Bankrate
personal resources
Auto Loan Calculator | Bankrate®. (2023, November 15). Bankrate. https://www.bankrate.com/loans/auto-loans/auto-loan-calculator/How do auto loans work? (n.d.). Jovia Financial Credit Union. Retrieved November 21, 2023, from https://www.jovia.org/articles/5-things-you-need-to-know-about-auto-loansMartin, A. (2023, September 12). What An Auto Loan Is And How It Works. Bankrate. https://www.bankrate.com/loans/auto-loans/what-is-an-auto-loan/Robinson, D. (2023, October 5). How To Finance a Car: Get an Auto Loan in 4 Steps. MarketWatch. https://www.marketwatch.com/guides/car-loans/how-to-finance-a-car/What things can I negotiate when shopping for a car or auto loan? (2023, August 28). Consumer Financial Protection Bureau. https://www.consumerfinance.gov/ask-cfpb/what-things-can-i-negotiate-when-shopping-for-a-car-or-auto-loan-en-2132/What’s a Good APR for a Car Loan? Find Out Now | Baton Rouge Telco FCU. (n.d.). Www.brtelco.org. Retrieved November 21, 2023, from https://www.brtelco.org/talking-cents-financial-insights/whats-a-good-apr-for-a-car-loan-find-out-now#:~:text=What%20is%20a%20good%20APR
References