Auto Financing Basics

Auto Financing for GMC Customers

Getting your next vehicle is a big investment. That doesn't mean it shouldn't be exciting. The key to having a rewarding experience is knowledge. Here are the basics of auto financing to get you started:

1. Buying A New Car - Know the difference between buying and leasing. When you buy a vehicle, you typically obtain a loan and pay it off. This approach allows you to gain equity as you go. It also gives you the freedom to drive as many miles as you want and modify your car as much as you want.

2. Leasing A New Car - Leasing is much akin to a long-term loan, with one of the benefits being that you get to enjoy a brand-new car but are not "stuck with it" when a new model comes out. Another benefit of leasing is that monthly payments are typically lower than a new car loan. However, leases come with mileage restrictions and restrictions on vehicle modifications.

3. Direct Lending - Most people will obtain financing to buy a vehicle. Direct lending involves getting a loan directly from a bank. Many people will obtain pre-approval at their bank. This lets them narrow the field down based on price.

4. Dealership Financing - Dealership financing means obtaining a loan through the dealership. The benefits of doing so are that dealerships can be a lot more flexible than working with banks directly. Dealerships have relationships with numerable banks so they can give you more options. It also takes the legwork out of the equation for you.

5. Credit Score - Your credit score is central to auto financing. It alone will be the biggest determining factor as far as the loan amount and the terms of the loan. Know your score and learn how to improve your score. If you have a lower score, dealerships are often more willing to work with you.

5 BASIC ELEMENTS OF ANY LOAN - 2 MINUTE FINANCE

Whether you're borrowing money from a bank to buy a house, buy a new a car or just charging purchases to your credit card, your loan has five basic elements that you should understand. We'll break down these elements and what they mean in two minutes. For more information and resources, visit our website, 2MinuteFinance.com. You can also find us on Facebook (Facebook.com/2MinuteFinance) or Twitter (@2MinuteFinance).

Come see our friendly finance experts at Alexander GMC of Simi Valley with any questions you may have about financing your new or used car purchase. No matter if you're ready to buy today or if you're just starting to look at getting a new car, we are more than ready to help you figure out the best financing plan for your driving habits and budget. Stop by our Simi Valley, CA dealership at 2100 First Street or give us a call at Sales 866-640-0301 today. We look forward to helping you!