How a loan works Oviedo 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

K & K USA Enterprises
(407) 971-3760
2681 Rustic Oak Pl
Oviedo, FL
Titan Motorsports
(407) 977-9732
563 W Palm Valley Dr
Oviedo, FL
New Future Auto Sales
(305) 633-8691
2167 NW 24th Ave
Miami, FL
Crystal Motor Car Company
(352) 563-2277
1005 S Suncoast Blvd
Homosassa, FL
Bill Buck Chevrolet Inc
(941) 493-5000
2324 Tamiami Trl S
Venice, FL
Advantage Chrysler Plymouth-Dodge Inc
(352) 343-2970
Tavares, FL
Gold Motor
(305) 636-4030
2390 NW 36th St
Miami, FL
Fantasi Auto Sales Corp
(305) 635-7908
3601 NW 37th Ct
Miami, FL
Lokey Volkswagen
(727) 799-2151
27850 US Highway 19 N
Clearwater, FL
Tri County Truck & Equipment
(561) 472-1947
2172 N Military Trl
West Palm Beach, 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.

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