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Cheap Auto Loan Rates

Finding cheap auto loan rates can help a car buyer save quite a bit of money when purchasing a new or used vehicle.

Car buyers should seek out cheap auto loan rates because the interest rate determines the cost of money. The interest rate is added to the cost of the loan so it determines the amount of the loan and the amount of the car payments.

Cheap auto loan rates usually equal cheaper car payments. Getting a cheap auto loan rate can help a car buyer save several hundred or even several thousand dollars on a vehicle.

Finding Cheap Auto Loan Rates 

Generally the cheapest auto loan rates available to average people are those offered by local banks and credit unions.

Credit unions which are non profit lending institutions usually give their members cheap auto loan rates. A person who is a member of a credit union should check with their credit union to see if they can get a loan before going car shopping.

Banks can also offer cheap auto loan rates to their customers. A person should check with their bank to see what deals are available to deposit holders.

Generally banks and credit unions will offer cheaper auto loan rates than car dealers. Going to such lending institutions before going to the dealer can help a person locate cheap auto loan rates.

Shop Around for Cheap Auto Loan Rates

The key to finding cheap auto loan rates is to shop around for them. Visiting several different lending institutions can help a person locate the cheapest auto loan rate in their community.

Going online and looking at a wide variety of auto loan deals will enable an individual to locate the cheapest auto loan rates. Online lenders often offer much better deals than car dealers and local lenders.

Dealers will be more likely to offer cheap auto loan rates to those who make it clear that they are going elsewhere for auto loans. A dealer will often give a person who is planning to seek an auto loan elsewhere a much cheaper auto loan rate.

Cheap Auto Loan Rates

A car buyer should not just look for cheap auto loan rates when car loan shopping. The buyer should also take a close look at the terms of the auto loan.

The terms tell the buyer how many payments they have to make and how it long it will take to pay off the loan. Generally, a long term loan will be more expensive but offer lower payments while a short term loan maybe cheaper but come with larger monthly payments. Long term loans are usually a better deal for those with low incomes who can’t afford large payments. Short term loans are better for those who can afford to make larger loan payments.

Buyers should also be on the lookout for clauses in loan contracts that can increase the cost of auto loans. An example of this is clauses that add late charges or increase the interest rate if a payment is late or missed. A loan contract that enables a person to make a late payment without incurring extra charges or interest can help a buyer save money.