How Does Car Financing Work?

a car owner learning how car financing works
 
When the time comes to purchase a used or new car for your Oceanside commutes, you have a few options. You can purchase the vehicle outright, lease it, or apply for financing. So what is car financing, what does it mean to finance a car, and how does car financing work? The finance team at Quality Chevrolet can help you get the answers you need.

 

 

How Does Financing a Car Work?

The first step to learn how car finance works when buying a new or used vehicle is to apply for the loan through the dealership, a bank, or credit union. This application can be started online or you can start the application at the dealership. A few factors lenders will look at include:

  • Credit Score
  • Loan Amount
  • Length of Loan
  • Debt-to-Income Ratio
  • Age of the Vehicle

If you know you have a low credit score, or if you have no credit, ask a family member or close friend to cosign your loan.

Choose Your Lender

Once you’re approved for a loan, you have a few options moving forward. If the dealership offers in-house financing, you can compare their offer to an offer from a bank or credit union to see which makes most sense for your budget. Use our online payment calculator to see how much money you can put down, how much your monthly payments will be, and more to ensure you will be able to pay back the loan.

Finalize the Loan Terms

Before you finalize the loan to buy a car, you may want to negotiate on price. If this is the case, you and the car dealership salesperson will go back and forth until you settle on a loan with an interest rate that works for you. Once you have, you can finalize the loan terms and close the deal. Once you sign the necessary paperwork, you can take delivery of the car and drive home to Poway!

Want to Know More About Car Financing in Escondido?

Learn more about the automotive finance process, other financing tips, and more with our finance experts at Quality Chevrolet. If you have any questions, want to learn about our new vehicle specials for additional savings, and more, don’t hesitate to contact us.

 

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1550 Auto Park Way
Escondido, CA 92029
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