How a loan works Matthews NC

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

City Chevrolet Company
(704) 536-1410
5101 East Independence Boulevard
Charlotte, NC
Folger Automotive
(704) 536-9635
5701 East Independence Boulevard
Charlotte, NC
foreign cars italia
(704) 535-7100
5216 East Independence Boulevard
Charlotte, NC
Infiniti of Charlotte
(704) 847-9010
9103 E Independence Blvd
Matthews, NC
Liberty Pontiac
(704) 708-8000
9028 E Independence Blvd
Matthews, NC
Harris Cars Inc
(704) 684-0063
3460 Gribble Rd
Matthews, NC
Hendrick Chevrolet
(919) 380-8821
100 Auto Mall Dr
Cary, NC
Chris Leith Chevrolet Inc
(919) 556-8834
10936 Star Rd
Wake Forest, NC
Westside Chrysler Dodge Jeep
(336) 751-5948
298 E Depot St
Mocksville, NC
Stanton Auto Sales
(252) 492-8300
3590 N Lynnbank Rd
Henderson, NC

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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

City Chevrolet Company

(704) 536-1410
5101 East Independence Boulevard
Charlotte, NC

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Related Articles
- Credit Score and Buying a Car Matthews NC
Check your credit report and know your credit score before you buy a car. If you're planning on financing your car with an auto loan, it's useful to know your credit score so you get the best interest rate.
- Auto Loan Payment Calculator Matthews NC
- Car Loans Matthews NC
- Used Car Loans Matthews NC
- Auto Leasing Pros and Cons Matthews NC
- Negotiate for the Cheapest Auto Loan Matthews NC
- Car Financing Matthews NC
- Car Finance Matthews NC
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