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Auto Loans 101: How to Navigate the Car Financing Process

Buying a car is exciting and can be overwhelming with choices. Should you buy new or used? Should you get the car from a dealership or via a third party? Should you lease or buy? Do you get those upgrades that you’ve been drooling over since you started car shopping? No matter your choice, UHCU has the right loan to help you drive that dream car home and to do so at a good price.

Understand Your Options
Just like the numerous choices you have when selecting a car, you have many options for auto loans. At UHCU, we offer loans for both new and used vehicles and can help you refinance your current loan from another lender if you are looking to lower your monthly payments or your desired term has changed. We can help you decide on a budget that best fits your needs.

Things That Impact Your Monthly Payment
Your monthly auto payment will depend mainly on three different factors among others; your loan amount, the length of your loan and the interest rate. The amount of the loan can vary depending on the amount of your down payment and any trade-in value or loan roll-over amount you may have on a previous vehicle. Your interest rate will last the entire time of the loan and your length of loan usually ranges from 36 to 72 months. Like other loans, the larger down payment you have to put towards the loan, the less you may have to finance. This can lead to significant monthly savings. These are great things to discuss with our loan specialists as they may have other insights on down payments depending on current interest rates.

UHCU vs. Dealership Rates
UHCU offers new car loans with very competitive low rates and we’ve made applying for a loan easier than ever. Generally, loans for new cars financed at the dealer offer longer repayment terms and can have lower interest rates than those for used vehicles but at UHCU we offer the same low rate for both. We also offer loans with no payment for 90 days. Our loan specialists can help you with the entire loan process and will guide you every step of the way.

For pre-owned vehicles, we still offer great rates and our same excellent loan services. If you choose a shorter term for a used car, your payment may be higher each month than on a new car. However, you might be making up savings with an overall lower price of the car.

Used Car? Find Out the History
You’ll want to make sure that you know the history of any used car that you may be interested in buying. A car history report can highlight any red flags such a major accidents and repairs that may bring the value of the car down. Make sure to do your homework on the car’s history before agreeing to buy. AutoCheck and CarFax are two services that help in researching a vehicle’s history.

Getting Pre-Qualified is Worth It
Getting pre-qualified for any loan is always a good path when buying on credit. Having a pre-qualification allows for peace  of mind when you decide to purchase a vehicle. You’ll have a good idea of what you can afford, your monthly payments and the type of loan that you’ll need. This eliminates additional stress that may come with overwhelming financial offers from the dealership. It is sometimes difficult to know what the real cost of an auto might be when the dealership combines trade-in value from another car, dealer fees and upgrades. You’ll have bargaining power with financing in place before you ever start shopping for the new car.

Don’t Forget About Insurance
Once you’ve decided on a car and have solidified your financing, it is important to make sure that you have the appropriate insurance coverage. At UHCU, we also offer insurance through UHCU Insurance Services. We can help you find the right policy for your car and your family. We’ll work with you to make sure you’re covered should an accident happen. You’ll get peace of mind knowing that you’re protected financially. Find out more about our insurance offerings and how we can best protect you on our website.

Refinance Tips
If you’ve decided that now is the right time to refinance an auto you financed through another lender, we can help! With interest rates staying low right now, you may be able to see significant savings with a new loan. If your credit has improved since purchasing your current vehicle, a new loan may also be a good bet for lowering monthly costs and getting a lower interest rate.

Make sure to check your current loan for any prepayment penalties. Occasionally, other financial institutions may charge you for paying off your loan early. As always, our loan specialists can walk you through the process and help you to decide your best financial choice.

Test Different Scenarios with a Loan Calculator
If you would like to estimate your loan payments, we offer an easy to use auto loan calculator on our website. With this, you can see how increasing your down payment or refinancing for a better rate can bring you more cash in your pocket each month.

Finalize Your Loan from Home
We’ve worked hard to make sure that getting a loan is easy and convenient for our members. A no obligation application can easily be completed online from the comfort of your couch. We also offer DocuSign which allows you to complete the loan process electronically without ever leaving the comfort and safety of home. UHCU offers quick closings on loans so that you can get on the road in your new vehicle as soon as possible.

At UHCU, we’ve got you covered and you’ll be ready to hit the road in no time!

Auto Loans 101: How to Navigate the Car Financing Process
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