How a loan works Parkville 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

Heritage Chrysler Jeep
(410) 661-3400
9219 Harford Rd
Parkville, MD
MacRis Auto Sales
(410) 665-3773
1742 E Joppa Rd
Parkville, MD
Schaefer & Strohminger
(410) 661-7600
1765 E Joppa Rd
Parkville, MD
Schaefer & Strohminger
(410) 661-7600
1765 E Joppa Rd
Parkville, MD
Koons Toyota
(410) 280-4630
1107 West St
Annapolis, MD
Easterns Whitemarsh
(410) 780-5133
7910 Pulaski Hwy
Baltimore, MD
Pohanka Automotive Group
(301) 899-3744
4601 Saint Barnabas Rd
Temple Hills, MD
Central Truck Central Inc
(301) 322-9000
3839 Ironwood Pl
Hyattsville, MD
Annapolis Motor Cars
(410) 349-8090
Annapolis, MD
Lewis Motor Co
(410) 796-3232
Elkridge, MD

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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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- Car Loans Parkville MD
Financing a car is a dream, which not everyone can afford due to involvement of high investments. The reason may be of either limited income or insufficient savings. And due to these reasons the people keep their dreams on hold.
- Lowering Auto Finance Costs Parkville MD
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