4 Things You Should Know Before Financing a Car Loan…Especially if you’re a woman!
Money Tip: Shopping for a car can be an overwhelming experience especially when inventory is high. There are so many years, models, makes and colors to choose from so it can be easy to become overwhelmed. However, when financing a car, pay attention to 4 things:
- When I financed my 1st car at 18, I was charged a whopping interested rate of 32%. I was so young and uneducated in this area, I didn’t even pay attention to the interest rate because I was only focused on the monthly payments. Besides, all I cared about was driving my “new” car to school the next day. This was definitely a bad financial decision!
2.Length of loan
- How many years will it take to pay your car loan off? This is a very important question you must ask your sales representative. I recommend staying away from car loans that are 4+ years long. Loans that are longer than 4 years will cause you to pay too much money in interest.
3. The total amount you will pay after the loan is paid in full.
- Whatever you do, don’t drive off in your new car without knowing the total amount you will have paid after your loan is paid in full. Believe it or not, many individuals have no idea!
4. Kelly blue book value
- Surprisingly, some people have no idea as to how much their car is worth so before you drive off the lot in your brand new car (in my best Bob Barker’s voice, lol), make sure you know how much the car is worth!
Oftentimes, the dealer wants you to focus on the monthly payment instead of the 4 things listed above, but in the end, you will end up paying a total amount that is worth wayyy more than the car itself. Do your research before signing the dotted line and you will be in good shape!
Now it’s your turn…do you have any tips or experiences to share regarding your car buying experience? Share in the comments below!