Car Loans For You
May 22, 2008 – 4:02 pmIn most countries, buying a car is not a luxury but a necessity to get you where you want to go. You need the wheels and if you cannot pay the whole amount upfront taking a car loan is a very common practice.
Most car loans are for 60 months (5 years) and usually involve a down payment, which is usually 20% of the purchase price of the vehicle, the shorter the term of payment the lower the interest rate. Of course, this is a personal choice depending on how much of your income you can give towards a car loan every month, consistently for 5 years.
How much interest would you be ending up paying on a car loan? The interest on your car loan depends on your credit rating, the loan term (how long until you pay it off), the state you live in, and the age of the car you are purchasing. Car loan interest rates for a new car are around 8.5%. On used cars the rates are about 9.5%.
Credit ratings are an assessment of your credit worthiness and usually depend on your current assets and liabilities. Financial history is also taken into consideration. Credit rating is an important fact when procuring a car loan or any loan.