How does car financing work? | OK Carz

Older man sitting next to a woman shaking hands with a sales person

What car financing and loan options are available at OkCarz? 

Buying a new car is probably one of the most expensive purchases that you’ll make. Even with a reasonably priced used vehicle, most people wouldn’t be able to pay the entire price upfront, and even if you could, there are some advantages to using a loan to finance a new car. Before you can decide if an auto loan to buy a vehicle, it can be helpful to understand how car financing works.   

How you finance your vehicle depends on your credit score and your monthly budget. Even if you’re approved for a high loan amount, you need to make sure that you’ll be able to make your monthly payments. If you aren’t able to make your payments, it can affect your credit score, which will make it harder for you to qualify for other loans.   

With an auto loan, you won’t have to worry about making a big purchase and draining your accounts, and you can instead spread your payments over a pre-determined amount of time with some interest. Most vehicle loans are between 36 and 72 months, with a minimum payment you have to make every month. If you can pay more every month, that will lessen the time you have to spend paying off of your vehicle.

[Related: How to fix having a bad credit score]  

Man sitting next to a blonde woman shaking hands with a car dealerWhere can you get a car loan? 

There are multiple ways that you can get a car loan. Many people will go through a bank or credit union, which can be a great option for drivers who have a bank that they trust. That means that you’ll be working with someone that you trust, but it can be difficult to schedule a time to meet, since banks normally close fairly early on weekdays, and aren’t open long or at all on weekends.  

Another avenue that you can pursue is getting a vehicle loan from the dealership. You are already trusting them with your business and safety when you purchase your car, and you can figure out the financing while you’re choosing your vehicle. If you’re interested in learning more about dealership financing options, you can find information on the OkCarz website. If you’re already considering financing through a dealership, it is easy and safe to apply for pre-approval online 

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