How a loan works Longwood FL

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

Ferrari Independent Dealer
(407) 339-3443
895 N Ronald Reagan Blvd
Longwood, FL
Longwood Lincoln Mercury Inc
(407) 831-8090
3505 N US Highway 17 92
Longwood, FL
Faris Auto Sales
(407) 695-2999
240 North St
Longwood, FL
J & W Auto Sales
(407) 328-1005
3805 N Ronald Reagan Blvd
Longwood, FL
Courtesy Pontiac GMC
(407) 767-7990
650 N US Highway 17 92
Longwood, FL
Holler Kia of Longwood
(407) 571-1234
625 N US Highway 17 92
Longwood, FL
Export Auto
(407) 321-0387
3230 N US Highway 17 92
Longwood, FL
Southwest Dealer Services
(407) 869-7001
150 E Wildmere Ave
Longwood, FL
Longwood Auto Sales
(407) 260-5229
217 E State Road 434
Longwood, FL
Don Mealey Acura
(407) 695-8000
2455 S US Highway 17 92
Longwood, FL

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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

Lexus of Clearwater

(727) 726-6000
27547 US Hwy 19 N
Clearwater, FL


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