When you’re looking for a new or used vehicle near Weatherford, it pays to understand how car finance works. What does it mean to finance a car? Financing involves applying for a car loan and getting a result based on factors like your credit score. And generally speaking, better credit scores mean better financing offers from dealerships, banks, and credit unions. Learn more below as we answer, “How does financing a car work?”.
What does it mean to finance a car? How car finance works is fairly straightforward, but there can be a lot of steps along the way until you get your vehicle. The first thing to do is have an understanding of your credit score. A better credit score likely means that you’ll get better offers when you apply for financing. It may not be a good idea to finance a car if you need to work on your credit, but there are ways to increase your credit. You can open a credit card where you’re able to or use a current credit card on purchases that you know you can afford and pay them off immediately. This will increase your credit over time, but you have to be consistent.
If you know you have an acceptable credit score, you’re ready to begin applying for financing with a dealership like Granbury Nissan, a bank, or a credit union. Lenders will keep the following in mind when looking at your application:
When applying for financing, we highly recommend applying to multiple lenders within 14 days. Doing this means that you’ll have less of a temporary impact on your credit with those multiple credit checks, and you’ll have plenty of options to choose from. Look over your offers carefully. You may be approved for a short term loan, but you’ll pay more per month. Longer-term loans cost more over time, but they have lower monthly payments. And you can always add more to a monthly payment to really lower the total amount of interest paid. Think over what you can and can’t do before finalizing the terms. There are also trade-in options at many dealerships, including at Granbury Nissan.
Before finalizing your loan, you may want to negotiate on a price. If you’re looking to negotiate, you and the salesperson can go back and forth until you settle on a loan with an interest rate that works for both parties. Afterward, you can finalize the loan term and close the deal. You’ll then sign all of the necessary paperwork and drive home in your new vehicle!
Still have questions? Contact us today to learn more about car financing! We offer a variety of new and used car specials in Granbury, and we even offer other money-saving options like our college grad program.
