Importance of Finding Low Interest Rates for Car Financing
by Bruce Sheridan
If you are an educated car shopper, you already know that buying a car for a low sticker price is not good enough; you also need to find cheap financing as well. Getting a good car loan will take a little preparation and some patience, but after doing a little bit of math you can easily see the difference and why it will save you a lot of money to get the best loan you can.
One of the biggest factors in how much money you will pay over the life of the loan is the interest rate. It may not seem like a very big number, and for the untrained eye it can be easily overlooked just how much money you will pay in interest. However, a difference of even just 1% can equate to hundreds of dollars for even the affordable new cars, and it is even bigger for more expensive models.
To show why you should always shop around for interest rates, say Tommy needed to take out a loan for $15000. He did not think that interest rates were a big deal and went with the first loan he could get. He signed the deal for a 36 month loan with a 12% interest rate. That put his monthly car payment at about $500, which means he will pay nearly $18000 on the entire loan, or $3000 in just interest.
Susy on the other hand dedicated some time to shopping around and seeing what kind of deals she qualified for with different lenders. After investing a little time, it paid off for her, and she found a 36 month car loan for $15000 with a 6% interest rate. This put her monthly payments at about $450, which means over the whole three years she will have paid $16200, or only $1200 in interest. Do not be like Tommy; be like Susy. Shop around and check out what affordable loans we can connect you to.
One of the biggest factors in how much money you will pay over the life of the loan is the interest rate. It may not seem like a very big number, and for the untrained eye it can be easily overlooked just how much money you will pay in interest. However, a difference of even just 1% can equate to hundreds of dollars for even the affordable new cars, and it is even bigger for more expensive models.
To show why you should always shop around for interest rates, say Tommy needed to take out a loan for $15000. He did not think that interest rates were a big deal and went with the first loan he could get. He signed the deal for a 36 month loan with a 12% interest rate. That put his monthly car payment at about $500, which means he will pay nearly $18000 on the entire loan, or $3000 in just interest.
Susy on the other hand dedicated some time to shopping around and seeing what kind of deals she qualified for with different lenders. After investing a little time, it paid off for her, and she found a 36 month car loan for $15000 with a 6% interest rate. This put her monthly payments at about $450, which means over the whole three years she will have paid $16200, or only $1200 in interest. Do not be like Tommy; be like Susy. Shop around and check out what affordable loans we can connect you to.
