When it's time to buy a vehicle, more Americans are turning to car financing to afford them. In fact, a record 107 million Americans currently have a car loan. If you’re one of the many, there are several considerations to think about before signing on the dotted line.
Before signing up for car financing, read the terms carefully, including the fine print. Make sure you understand the term length, late or early payment penalties, and other essential information. Ask your car dealer for a copy of the terms to review during the negotiation process.
Review your payment structure as well. Most lenders charge higher interest rates for longer terms. It’s also critical to make sure you can afford the payment each month, including the interest. Car financing professionals often recommend that your debt not exceed 10% of your gross income.
Don’t neglect the power of a down payment! You can effectively manage your payments when you opt to put more money down. Lowering the total amount you’re financing can help shorten the term of your note, which prompts lenders to offer a more attractive interest rate.
When it comes to added costs, ask your car dealer about any included maintenance or warranties. Many pre-owned cars offer an extended warranty — however, the price might be rolled into the car financing package instead of outright. Ask your salesperson to provide a side-by-side comparison of how adding the extended maintenance affects your monthly payment.
If you’re looking for car financing on pre-owned cars, trust the friendly, knowledgeable team at Comet Auto Sales. With over 70 years of combined car sales experience, they offer reasonable prices on quality used vehicles. Call (603) 836-5775 to speak with a friendly representative, and fill out a loan application online.