How Does Car Financing Work?

January 10th, 2019 by

Woman buying a car and sales person handing her car keys

When you’re ready to buy a new Nissan or used vehicle for commutes or carpools near Arlington, you have three options: buy it outright, lease it, or finance it. Most people opt to lease or buy. If you’re wondering, “how does financing a car work?”, we’re here to tell you, so you can have a better car-buying experience.

Finance Department  Apply For Financing

Choose Your Lender

If you’re asking yourself, “What Does it Mean to Finance a Car?”, the first step you’ll take is to choose your lender. This can your local Bartlett dealership, a bank, or a credit union. Some dealerships provide the option of in-house financing. You can see what each offers to help you choose what works best for your budget. Be sure to calculate how much money you can put towards a down payment and how much you can afford each month to ensure you’ll be able to pay back the loan on time. You can also negotiate the total price to try to save yourself some money.

Apply for Your Loan

The next step you’ll take to finance a new or used vehicle is to apply for an automotive loan. You can easily start the finance application online, or you can apply in person. To determine if you can be approved, the lender will look at:

  • Your Credit Score
  • The Loan Amount
  • Your Debt-to-Income Ratio
  • The Length of Loan
  • The Age of the Vehicle

If you know your credit score is poor or you have a limited credit history, you may want to ask a friend or family member to cosign your loan.

Finalize the Loan Terms

If you’re approved for your automotive loan, the next step is finalize the terms. You must agree to the interest rate, monthly payment, and length of the loan. You can negotiate these terms if you wish, or you can accept what is offered. Once you’re satisfied with the loan terms, you can finalize them and close the car deal. After you sign the paperwork, you can take delivery of your new or used car and drive home to Memphis or the surrounding area.

Learn More About Car Financing at Wolfchase Nissan

To find out more about automotive financing, you can easily contact us online or ask in person when you visit our Bartlett showroom. A member of our finance team will be happy to help you out!

Posted in Finance