Getting a Car loan

by Kevo
(Overland Park, KS)

Question: I'm wanting to know about getting a car loan, and how interest works and how long it would take to pay one off.


Answer: Hi Kevo. Well I have a few pages that I suggest you take a look at that I feel might help you quite a bit. I'm assuming this is your first time buying a car (at least financing one) and you'd want to start with first time auto loans.

I'm also going to assume that your credit is fairly limited if not non existent, so my no credit auto loans should be a good read for you too.

On either of those pages I show 3 excellent places to look for getting Car Loans, so that will cover your "how to get a loan" question. Apply, get approved and either the lender or the dealer will walk you through the rest of the steps.

As for how interest works, it's basically the banks fee for loaning you money. The longer the term of your loan and the higher the interest rate, the more the loan will cost you.

The finance charge should not be a fixed fee and depending on how quickly you pay off the loan, or sometimes how slowly, will determine whether you pay less than the full finance charge, the exact finance charge on the contract, or more than the finance charge.

Paying your loan on time, or early is the best way to pay. Pay slow and you could seriously affect your credit, plus pay more in finance charges.

As for how long it will take to pay off your loan, that will largely come down to what term you select, i.e. 36, 48, 60, 72 months, etc. The lender will also have a say as to how long a car loan they will allow you to have.

As mentioned above, you could pay off any one of the loan terms mentioned above (and many not mentioned) in the stated time or less. That will depend on how much you can afford to pay each month. Pay twice the minimum payment and you'll pay your car loan off in half the time.

Ultimately, getting a car loan is not all that difficult and I recommend you work with a professional loan specialist at a dealership. Apply here for Car Loans and a specialist in your local should be in touch shortly.

Hope this helps,
Justin