Auto Loan FAQs

1 What is the maximum auto loan amount I can borrow?
In most cases you can borrow up to 125% of the assessed value of the car. This is in addition to the title, license and taxes and based on the MSRP. If the car is used then the NADA value will be used.

2 What are the standard auto loan terms?
There are several different terms for new and used vehicle auto loans. Standards say three to five years for an auto loan. If the car is new and has an assessed value of above 15 thousand dollars the terms can be extended to six years.

3 How will I know if I am paying the right amount for the car?
To know the right amount to pay for a car, you should consult the NADA guide. The NADA will tell you the correct value for the car in question. Most banks will provide computer generated print outs of the value, using the NADA software program.

4 What I do if the bank is closed when I find the car I want to purchase?
The dealership, where the car is located will likely have a finance department. This is the best way to make sure that you can still get your auto loan even if the bank is closed. Make sure that they are doing the loan in the correct format and to the exact specifications that you desire.

5 What information is needed to close my auto loan?
To close an auto loan you will need to make sure that you provide the purchase order, which will disclose the full price including all extra fees. You will also be required to provide full coverage insurance where the bank is noted as the lien holder.

6 What is better, the dealer rebate or lower financing rate?
Under normal conditions the dealer rebate is the best idea. Take the rebate and have it applied to the purchase price. This will lower the amount that you are paying for the car, thus it will lower down the amount of the loan you need to take out. If you think the lower financing rate is going to be a better deal then call the bank and have them to figure the loan both ways to see how much money you can save. Ask about the best auto loan rates they can give you.

7. What is the best method for protecting my automobile investment?
Full coverage insurance is always the best idea and may be required by the financial institution that holds the lien. Full coverage insurance will cover nearly all of the costs that are associated with the vehicle in case it is involved in an accident or in needs to be repaired.

8 Should I obtain an auto loan or home equity loan to purchase my car?
There are many advantages to both, an auto loan and home equity loan for the purchase of a car. A home equity loan is the best idea if you have a large amount of equity in your home. This can save you a lot of money in long run with lower interest payments. An auto loan is best when you have limited equity and need to quickly close the loan. There are many programs that offer low rates and reasonable payment terms.

9 How can I get the cheapest car loan interest rate?
Check out several different lenders about the best auto loan rates they can offer.