Financing 101 in Thomasville, GA

Auto Financing 101 at Thomasville Ford Lincoln

Buying a new car brings excitement, but it can also feel overwhelming. There are lots of things to consider, the model and type of vehicle, price, and the financing process. If you are uncertain of where to begin, don’t worry. Acquiring an auto loan at Thomasville Ford Lincoln in Thomasville, Georgia is a pretty simple process.

If you are new to auto loans, check out the information below. We walk you through everything you need to know about auto financing. Read on and give us a call if you have any questions.

What Is Auto Financing and How Does It Work?

Let’s start with the basics. Financing a vehicle is when you borrow money from a lender. You agree upon the amount you would like to borrow, which you will then pay back over a set period of time. This amount will include an interest rate, which is a percentage of the cost of the loan which is essentially your payment to the lender for lending the money.

Here are a few things to keep in mind when financing a vehicle purchase:

• Get pre-approved for a loan before you start shopping for a car. This will give you an idea of how much you can afford to borrow and what your monthly payments will be. This way, you show up prepared and can shop with peace of mind knowing what is in your budget.
• Shop around for the best interest rate. Interest rates can vary depending on the lender, the type of loan, and your credit score.
• Consider a shorter loan term to pay less interest in the long run.
• Make a down payment to reduce the amount you have to borrow and lower your monthly payments.
• Be prepared to pay other fees, such as origination fees and closing costs.

Different Types of Auto Financing Available

There are a few different types of auto loan financing and we have broken each type down for you below:

• Secured auto loans: A secured loan is a loan that is backed by collateral, which is an asset that the borrower pledges to the lender in case they default on the loan. In the case of a secured car loan, the collateral is the car itself.
• Auto refinance: A better credit score can lead to lower interest rates on loans. If your financial situation has improved since you financed your vehicle, you may be able to refinance your loan for a lower interest rate.
• Leasing: Leasing a car is similar to renting an apartment. You pay a monthly fee to use the car for a set period of time, typically three years. At the end of the lease, you can return the car or buy it for a slightly lower price. Leasing is a good option for people who want to drive a new car every few years without having to worry about depreciation.
• First-time car buyer loans: First-time car buyer loans are a great option for people with little or no credit history. These loans typically have lower interest rates and other perks, such as a lower down payment or waived application fees. Be sure to compare offers from multiple lenders to get the best possible deal.
• Unsecured auto loans: Unsecured auto loans are not backed by any collateral, so the lender relies on your credit score to determine your eligibility. They typically have higher interest rates than secured loans because it’s a bigger risk for the lender. If you have good credit and can make a down payment, a secured auto loan is a good option. However, if you have bad credit or don't want to make a down payment, an unsecured auto loan may be a better option.

Visit Us at Thomasville Ford Lincoln

Hopefully you feel more confident in your understanding of auto financing now. When you’re ready to take that knowledge to the dealership, you can come to Thomasville Ford Lincoln in Thomasville, Georgia to speak with our knowledgeable staff about financing, leasing, vehicle purchasing, and more. We look forward to seeing you soon!