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What you need to know when getting an auto loan

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MSUFCU: What you need to know when getting an auto loan
Posted at 10:29 AM, Nov 22, 2021
and last updated 2021-11-22 10:29:53-05

Applying for an auto loan can be confusing, whether you’re buying your first car or fifth. MSUFCU Chief Marketing Officer Deidre Davis has several steps you can take to save money and get the best auto loan for you.

Before you start car shopping, look at your budget and determine the car payment you can afford. In addition to the monthly payment, include ongoing costs such as gas, maintenance, and insurance.

Next, talk to a lender and get an auto loan preapproval letter. This will include the amount you are approved to borrow, the interest rate, and loan term. It can help to have this document when you negotiate the vehicle price because it shows you are a serious buyer who has financing lined up.

Before applying for a loan, start saving for a down payment. It reduces the amount you need to borrow, saving you money on interest. You may also want to save for other fees, such as title, registration, and taxes. Adding these costs into the loan will increase the amount you borrow.

Usually, the shorter the loan term, the less you’ll pay for the vehicle because you pay less interest in total. Even with a higher monthly payment, you reduce the chance of owing more than the car is worth when you finance with a shorter term.

Once you are ready to sign the loan agreement, be sure the paperwork matches the deal you agreed to and that all documents are signed.

At MSUFCU, we help members get preapproved for auto loans in as little as 10 minutes. With our auto loan, you’ll receive a ReadyLoan Check — a blank check valid for 90 days, up to your preapproved amount. The Credit Union also offers auto loan refinancing and lease options.

Members can quickly and easily apply through the mobile app, by visiting the MSUFCU branch in downtown Grand Rapids at 86 Monroe Center Street Northwest, or by calling 616-552-6734.

Learn more by visiting msufcu.org.

This segment is sponsored by MSU Federal Credit Union.