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June 2, 2014

How Much Are Your Monthly Payments?

Shopping for a new car is an exciting moment in your life. You can’t wait to head to the lot, hop in a car and take it for a short spin before signing your loan agreement. One of the first questions that our customers ask us is about their monthly payments. We often see customers asking that question before they pick out a single car on the lot or take that car for a test drive. While we’d love to tell you how much your monthly payments are, we can’t give you an answer to that question until we run your credit. There are a number of factors that determine how much you’ll pay each month.

Cost of the Car

One of the main factors that determines your monthly payments is the cost of the car. If you buy a newer car with a retail price of $15,000, you’ll naturally pay more than someone who buys an older vehicle for $10,000. While we can’t tell you the exact size of your monthly payments, you should know that the more you spend, the more you pay each month. We encourage our customers to look at their monthly budgets and decide how much they can afford to spend on a new car before stopping by our lot.

Length of Your Loan

Car loans today come with different repayment terms, which often includes the length of the loan and the interest rate on the loan. Some shoppers apply for a loan of four years or less, while others take six years or longer to pay off a loan. To determine your monthly payments, look at the interest charged on the loan and divide the total cost of the car with interest by the number of monthly payments you’ll make. This will give you a good estimate of your monthly payments.

Interest Rate on the Loan

After you find a car that you love, talk to us about buying that car. Before agreeing to the sale, we will run your credit and let you know if you qualify for a loan and the interest rate on your loan. Most people with a job or a guaranteed source of income qualify for a car loan, but your interest rate might rise based on past problems on your credit report. Some of our customers even ask us to check their credit before shopping for a car. This lets them find out how much they’ll pay in interest on various models.

Want to Know More?

Do you want to know more about finance terms, repayment terms and interest rates? Whether you want to get an idea about your future monthly payments, or you just want to see what cars we have available, come in and talk to one of our sales agents. Our agents will walk you through the process of buying a new car, give you more information on our financing plans and help you decide which of the vehicles on our lot will meet your needs.

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