Applying for a car loan is not unlike applying for any other loan. The process can be quite complex especially for first-time borrowers. However, this doesn’t mean it has to be overly confusing. We’ll show you the step-by-step process for applying for a car loan.
First, check your credit report. This is crucial because your credit report will determine the loans and rates you’re eligible for. A good credit score helps you secure a low car loan rate. This translates to money saved due to paying lower interest. You can check your credit report for free once a year. Visit Federal Trade Commission to learn how to do so.
The next step is to pick your payment. Use a loan calculator to determine the amount you can realistically pay each month without straining your budget. Most car loans have between three and six-year repayment terms. A longer term means a lower monthly payment but could also entail higher interest.
Step three is to get pre-approved. This basically means getting qualified for the loan. With the pre-approval comes a certain amount of money for you to use towards your vehicle purchase.
The fourth and final step is to choose a vehicle. Most people already have a car in mind, perhaps the 2020 Kia Soul or another model. Whatever your choice, be sure it falls within your pre-approved loan amount unless you’re willing to pay extra out of pocket or trade in an existing vehicle.
Try to complete the above four steps within a two-week window. Too many credit inquiries over a prolonged period can hurt your score.
Have you decided on a car? Come by Sansone Kia to get started. Our Kia financing center near Edison NJ makes applying for a loan easy whether you’re buying or leasing.
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