|By Laura Gutmann on February 9, 2010
When it’s time to make a big purchase like a car, very few people have enough cash on hand to be able to afford the total cost of their new vehicle. This is why most people use an auto financing program to be able to make payments towards the total cost of their cars on a monthly basis.
If you are thinking of buying a new car, it might help to check out an online monthly loan payment calculator. These tools will help you figure out how much you can expect to pay in interest, the amount you’ll owe each month based on the size of your down payment, the length of your loan, local sales tax, and the trade-in value of your current vehicle. Often, you can trade-in your old car to help you pay for the new one.
Many banks will also have special auto finance websites, where you can apply for a car loan online and compare interest rates. However, your car dealership can also assist in connecting you to a bank and jumpstarting the application process. It is to their benefit to get you approved for a loan so you can make your purchase, so they have dedicated resources to helping you along the way.
When making such an important purchase, comparison-shopping is key. Tools like these worksheets and first-time buyer guides will help you record the sales price of the vehicle, the down payment required, any finance charges, the length of the contract, and other important factors.
The price of your vehicle is also negotiable, as well as the finance rate. It will benefit you to establish the price range that you can afford before visiting a car dealership. You should also consider the cost of add-ons like extended service contracts that are optional expenses.
If you are purchasing a used car, financing will also still be available – and you may even want to reconsider refinancing your current car loan, if you think that interest rates have dropped since you initially purchased your vehicle. It never hurts to investigate all of the possibilities, in hopes of getting a better deal.