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Buying your first car is an exciting adventure, but it’s also a significant investment that requires you to make some important decisions. Not only do you have to choose the right make and model, but you’ll also have to find an auto loan with the best terms possible. If you need financing for your purchase, avoiding the mistakes below will help you avoid serious consequences later on.

3 Common Auto Loan Mistakes

1. Not Looking at the Bottom Line

The monthly payment amount and interest rate are important factors when deciding on a loan, but the most critical is the total price of the vehicle. The duration of the loan, extra fees, and other costs can be just as essential, so be sure you check how much you’ll actually be paying in total before making your choice.

2. Letting the Dealer Choose Your Loan

auto loanMany dealerships will find a loan for you, which might seem convenient and helpful. However, it often comes at a cost, since they won’t necessarily be motivated to find the best terms possible. While the dealership might get you a loan with an attractive monthly payment, the interest rate and other fees might add thousands of dollars to the total cost of the car.

3. Taking the First Offer

Each bank and credit union has its own formula for calculating interest rates and fees, so you’ll likely see a wide variety from one lender to the next. Shopping around with multiple lenders will help ensure you get the best deal possible, potentially providing significant savings over the long run. 


 

As a member-owned nonprofit credit union, Spirit of America Federal Credit Union offers the best customer service and loan rates in Lancaster County, NE. They’ve been proudly serving military, postal, and federal employees and their families since 1932. Their knowledgeable staff is committed to helping each member achieve financial success. Visit their website for more information on their auto loans and other products, follow their Twitter for updates and news, or call (402) 467-1102 to start an application today.

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