Buying a new vehicle can evoke a range of mixed emotions. It’s an exciting achievement to hold the keys in your hand and switch keychains – financing not so much. Embarking on the journey to financing your new vehicle can come with stress and headaches if you’ve never done it before. Educating yourself on the details of financing gives you the tools you need to make an informed decision.
Here at Jim Taylor Ford, we’re ready to answer all your finance-related questions and partner with you in finding the right plan. If you’re looking to buy or lease, use our payment calculator to help with estimating monthly payments. Want to trade in your vehicle? Fill out our your trade form online, and we’ll get you on your way.
Below is your guide to all things financing. From the basics of what auto financing is to what affects your rates, we’ll give you all the tools you need.
If you aren’t already acquainted with auto financing, it is essentially a process of purchasing a vehicle when you may not have the full amount upfront. Auto financing is a great option that eliminates the restriction of a price tag.
Here’s how it works: a credit union, bank, or other financial institution will lend you a fixed amount of money to purchase the vehicle. You’ll then pay back that amount at a monthly rate with interest until it’s paid off.
The most important components of a loan you need to be familiar with are:
You have numerous options to choose from when financing a vehicle. Review these common financing options to determine which one suits you and your budget best.
Secured auto loans are secured by liens – a legal claim the lender has on the vehicle as collateral. The title of the vehicle can’t be transferred until the loan is paid back, and the lender can reclaim the vehicle if you fail to make payments. The cost of the loan can be determined by your credit score and your reliability in making timely payments.
Unsecured auto loans are different from Secured Auto Loans in the sense that they don’t hold the vehicle as collateral. Instead, after you’ve settled the terms of your loan agreement, the lender assesses your ability to make timely payments. This assessment is what determines the cost of the loan. Interest rates for this type of loan are usually higher due to the higher risk to the lender.
A new vehicle loan is exactly what it sounds like – a loan for a new vehicle. Because you’re purchasing a new vehicle that’s anticipated to have a longer life than that of a used vehicle, interest rates are usually lower.
Lease financing is a type of financing where you rent a vehicle for a set period (usually two to six years) or a specified mileage. Once you’ve come to the end of your agreed time or mileage, you have choices: you can buy out your current vehicle or trade it in for a different one. This is a great option for those who like to try out different vehicles without the commitment of buying.
Several key factors influence your auto loan rates. We’ve broken them down below so you can better understand how to get the best rate for yourself.
At Jim Taylor Ford, we understand that financing can be a confusing and discouraging process if not done with proper information and support. When you finance with us, you can have peace of mind that you won’t be pushed to settle for a plan that you don’t want. Our expert finance team is here to listen and advise with your budget at the forefront.
Visit us today at Jim Taylor Ford, proudly serving the Ruston, LA area. If you don’t have time to stop by, you can start your financing journey online with our financing application. We take pride in taking this next step alongside you and are always available to answer your questions. Start your journey with us today.
*Disclaimer: This content was drafted with AI assistance for initial drafting, reviewed by a subject-matter expert for accuracy, and edited by our team of writers and editors.
