When shopping for a new vehicle, most buyers attempt to get the best value possible, comparing prices between various dealerships and offering to negotiate on price. While this may save thousands of dollars, the car loan you choose can have a much greater impact on your final cost than the vehicle’s sticker price. Knowing what to look for in an auto loan can dramatically reduce your expenses and spare you the stress of being locked into unfavorable terms.

What to Think About When Looking for a Car Loan

1. Credit Rating

The interest rate you’ll be offered depends on your income and credit rating, so check your score before you apply. Getting a free copy of your credit report will not only give you a chance to have any mistakes corrected, but it’ll also let you know what your credit union sees and what loan terms you can expect.

2. Interest Rate

Unfortunately, many car shoppers focus solely on the monthly payment amount without thinking about the interest rate. Depending on the length of the loan and vehicle price, a slightly higher interest rate can raise the price of the car by several thousand dollars.

3. Term of the Loan

Many banks offer car loans with long terms, sometimes as long as 60 months. While this might translate to lower monthly payments, you’ll also pay more interest over the life of the loan. When comparing car loans, choose the shortest loan possible with a monthly payment you can afford.

If you’re looking for an affordable car loan, contact the team at Hawaii County Employees Federal Credit Union in Hilo. These professionals are dedicated to helping county employees and their families achieve financial success, offering low-interest car loans and friendly customer service. As a credit union, they’re owned by their members, not investors or shareholders, so they’re always committed to putting your interests first. Visit their website for an overview of their loan products, or call (808) 935-2969 to speak to a specialist today.