How a loan works Lawrence MA

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

Massachusetts Commonwealth of-
(617) 351-4500
599 S Union Lawr
Lawrence, MA
Auclair Auto Sales
(978) 682-5952
444 Riverside Dr
Lawrence, MA
Lewis Motor Sales Inc
(978) 794-1118
660 S Union St
Lawrence, MA
Commonwealth Honda
(978) 683-5000
1 Commonwealth Dr
Lawrence, MA
Free Cellular Phones
(413) 746-2266
500 Riverdale St
West Springfield, MA
Bertera Dodge Chrysler Jeep Inc
(413) 568-3322
167 Springfield Rd
Westfield, MA
Bancroft Edward
(508) 751-4700
72 Shrewsbury St
Worcester, MA
Dartmouth Dodge
(508) 984-7500
225 State Rd
North Dartmouth, MA
Mountain View Auto Sales
(413) 585-0599
71 Lawrence Plain Rd
Hadley, MA
Wagner Bmw of West Springfield
(413) 304-9010
1497 Riverdale St
West Springfield, MA

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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

Boston Autoport

(617) 242-2300
100 Terminal Street
Charlestown, MA


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