How a loan works Virginia

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

Sadler Chevrolet Pontiac Cadillac Buick GMC Auto Center
(757) 569-9756
Franklin, VA
Mitsubishi-Stohlman of Tysons Corner
(703) 448-9300
8435 Leesburg Pike
Vienna, VA
Countryside Auto Sales
(804) 561-3349
11831 Patrick Henry Hwy
Amelia Court House, VA
Casey Auto Group
(757) 591-1300
777 J Clyde Morris Blvd
Newport News, VA
Reynolds Pontiac-Cadillac-GMC Truck-Buick-Subaru Inc
(540) 672-3312
13220 James Madison Hwy
Orange, VA
Integrity Auto Sales
(757) 858-8546
3439 Sewells Point Rd
Norfolk, VA
Rosenthal Volkswagen
(703) 278-8967
11050 Main St
Fairfax, VA
Dodge Pomoco
(757) 369-3565
12629 Jefferson Ave
Newport News, VA
Priority Hyundai
(757) 877-9995
12872 Jefferson Ave
Newport News, VA
Kernstown Auto Sales
(540) 662-9579
3283 Valley Pike
Winchester, VA

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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.
Regional Articles
- How a loan works Alexandria VA
- How a loan works Annandale VA
- How a loan works Arlington VA
- How a loan works Ashburn VA
- How a loan works Bassett VA
- How a loan works Blacksburg VA
- How a loan works Bristol VA
- How a loan works Burke VA
- How a loan works Centreville VA
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- How a loan works Charlottesville VA
- How a loan works Chesapeake VA
- How a loan works Chester VA
- How a loan works Chesterfield VA
- How a loan works Christiansburg VA
- How a loan works Colonial Heights VA
- How a loan works Culpeper VA
- How a loan works Danville VA
- How a loan works Dumfries VA
- How a loan works Fairfax Station VA
- How a loan works Fairfax VA
- How a loan works Falls Church VA
- How a loan works Farmville VA
- How a loan works Fredericksburg VA
- How a loan works Front Royal VA
- How a loan works Galax VA
- How a loan works Glen Allen VA
- How a loan works Hampton VA
- How a loan works Harrisonburg VA
- How a loan works Herndon VA
- How a loan works Hopewell VA
- How a loan works King George VA
- How a loan works Leesburg VA
- How a loan works Lorton VA
- How a loan works Lynchburg VA
- How a loan works Manassas VA
- How a loan works Martinsville VA
- How a loan works Mc Lean VA
- How a loan works Mechanicsville VA
- How a loan works Midlothian VA
- How a loan works Newport News VA
- How a loan works Norfolk VA
- How a loan works Petersburg VA
- How a loan works Portsmouth VA
- How a loan works Powhatan VA
- How a loan works Radford VA
- How a loan works Reston VA
- How a loan works Richmond VA
- How a loan works Roanoke VA
- How a loan works Salem VA
- How a loan works Spotsylvania VA
- How a loan works Springfield VA
- How a loan works Stafford VA
- How a loan works Staunton VA
- How a loan works Sterling VA
- How a loan works Suffolk VA
- How a loan works Vienna VA
- How a loan works Vinton VA
- How a loan works Virginia Beach VA
- How a loan works Warrenton VA
- How a loan works Waynesboro VA
- How a loan works Williamsburg VA
- How a loan works Winchester VA
- How a loan works Woodbridge VA
- How a loan works Yorktown VA

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