Everything You Need to Know About Auto Financing

By: Lange & Fetter Motors   |   24 Jan 2023

Financing a new vehicle is a good idea for a multitude of reasons. Not only does it allow for lower upfront costs and help build your credit, but it also significantly increases your chances of getting a high-quality vehicle that will last. Still, the financing process can be a bit complex for those with zero experience in banking and finance.

Many dealerships will use complicated verbiage that you don’t always feel like you can trust. Others might pull excess credit checks, damaging your credit score in the process. At Lange and Fetter, our dedicated financial professionals will work with you every step of the process to ensure you get the best deal, the lowest interest rate, and a car that’s perfect for your lifestyle. In partnership with Quinte West Auto Credit, we employ a streamlined process that can help you pre-qualify for vehicles you’re guaranteed to get – without any risk to your credit score! Whether you have good credit, bad credit, or no credit, we handle the complicated parts of financing while keeping you informed from the first meeting straight up until your new car is in your driveway!

The Variables

The total cost, terms, and interest rate are the major players to keep in mind when it comes to calculating your car payments. The total cost includes any service fees (which we’re always transparent about) and optional add-ons you’d like with your vehicle. Terms typically run anywhere from 2 to 6 years. The shorter the term you choose, the more the upfront costs will be.

Interest rates are calculated as the percentage the specific lender decides to charge for the loan. These rates usually depend on the level of risk the lender is taking on the loan. Factors like your credit score, income, current debts, size of the loan, etc., will determine your interest rates.

Your options when it comes to financing a vehicle will be largely dependent on your personal credit and financial situation. However, there is a wide range of loans and interest rates available to individuals with varying credit, from good to bad to non-existent. While dropping your hard-earned cash on a new car outright can lift the burden of worrying about repayment, financing a vehicle allows you the pay much less upfront and avoid getting your savings tied up in an investment vehicle.

Here at Lange & Fetter, we work with many affordable and flexible local lenders that offer competitive rates to individuals with every type of credit status imaginable. Moreover, banks generally view vehicle financing as low risk as they can easily repossess the car in the event of non-payment.

Benefits of Financing

Speaking of which, there are plenty of other reasons financing a vehicle is a great idea, including:

  • Lower Costs Upfront. Why drop all your cash upfront when you can finance a vehicle in smaller incremental payments? Keep in mind that the greater downpayment you offer the better your financing will be!
  • Low-Interest Rates and Terms. No matter your credit, it’s highly unlikely that you’ll be unable to find a considerably low-interest rate or reasonable terms. As we mentioned, banks view financing as low risk.
  • Builds Your Credit. Whether your credit is in the poor zone or circumstances have made it virtually non-existent, financing a vehicle is a great way to show how you consistently and punctually keep up with payments, which over time, can help build your credit rating.
  • You Keep Your Savings. Having your savings tied up in an auto investment may seem smart, but the truth is your money could be better spent elsewhere, like a nest egg in case of an unforeseen emergency, or a good investment into something more beneficial for your future.
  • Get the Car You’ve Always Wanted. Deciding to purchase a car upfront limits your choices. Financing will significantly increase your chances of getting a high-quality vehicle that will last. With the help of our friends at Quinte West Auto Credit, you can begin the financing process by identifying your needs in a vehicle and what models you’ve had your eye on before locating a lender that matches your budget. When you pay cash, you’ll often have to do it the other way around.

Finance Your Next Vehicle With L&F

Here at Lange & Fetter, we’re passionate about not only helping our customers drive away in the vehicle of their dreams but also about offering guidance to our community about all things financing. As a trustworthy Quinte West dealership, we’re always on standby to answer any questions you may have about financing. Contact us or browse our online inventory today!

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52 Dundas St E, Trenton, ON K8V 1K7