How a loan works Glen Burnie MD

When you purchase a vehicle with a loan, a bank or other financial institution pays for most or all of the vehicle up-front, and you agree to pay back the money over time.

Local Companies

Jefferson Leasing
800--532-7352
2127 Espey Ct
Crofton, MD
Saturn of Glen Burnie
(410) 760-3000
10 Holsum Way
Glen Burnie, MD
Terrie Auto Sales
(410) 768-6552
706 N Crane Hwy
Glen Burnie, MD
Toyota City of Glen Bernie
(410) 787-9143
Glen Burnie, MD
Honda City-Honda
(410) 553-8580
7160 Ritchie Hwy
Glen Burnie, MD
National Car Sales
(301) 261-1849
6311 Ritchie Hwy
Glen Burnie, MD
Ted's Auto Sales
(410) 760-5577
7509 Baltimore Annapolis
Glen Burnie, MD
Wilkins Buick Isuzu Subaru
(410) 689-8000
6913 Ritchie Hwy
Glen Burnie, MD
J B A Chevrolet
(410) 766-6300
7327 Ritchie Hwy
Glen Burnie, MD
Southern Toy Store of Glen Burnie
(410) 863-8822
7352 Ritchie Hwy
Glen Burnie, MD

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2007 Volvo XC70
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Understanding Loans



When you purchase a vehicle with a loan, a bank or other financial institution pays for most or all of the vehicle up-front, and you agree to pay back the money over time. The amount of money you borrow from the bank is referred to as the "principal." The amount of money you contribute up-front is referred to as the "down payment" and usually varies from 10% to 20% of the purchase price of the vehicle. You can often purchase a new car without a down payment (if you qualify); used vehicles generally require a 20% or more down payment.



The payback period for a loan is typically up to five years, although some newer vehicles are being sold with longer-term loans. The financial institution will charge you "interest" for your use of their money. Interest rates vary depending on a number of factors such as your credit rating and where you live. Currently, new car loan rates start at around 8.5%, with used car rates about a percentage point higher. Manufacturers frequently offer lower loan rates as a purchasing incentive, but sometimes these are attached to conditions that may not work for you. Make sure you ask enough questions to make yourself comfortable when investigating various loan options.



 




Key features of loans




The primary features of loans are summarized below. Make sure you review our articles on leases and the differences between loans and leases before making a final decision.



 




  • You have ownership and equity in the vehicle. Your monthly payments are working to purchase that car and it's yours to sell or keep as long as you wish.



  • Gives you control over your vehicle.

Featured Local Company

Jefferson Leasing

800--532-7352
2127 Espey Ct
Crofton, MD


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