Questions to Ask About Auto Loans

An auto loan can help you drive the ride of your dreams, but it is important not to get ahead of yourself. There are a few questions that you should always ask your lender before you offer your signature. These are a few questions to ask about auto loans.

What Is the Total Price of the Vehicle?

It is easy to get lost in excitement when buying a new vehicle, but it behooves you to take a deep breath and think about the numbers. If you want to understand how much you are paying for your car, it is important to think about more than your monthly price. The terms of your auto loan will determine the amount of interest you will pay on your vehicle, which goes on top of the price of the car itself. Be sure to find out the total amount you will pay for your vehicle.

Are There Any Penalties?

Always know exactly what kind of terms you are agreeing to before you put pen to paper; some auto loan contracts involve different types of penalties, and it is helpful to understand them beforehand rather than after the fact. Certain contracts might even penalize you for making early payments, which is tricky because it forces you to extend your interest. Ask your lender if there will be any penalties or hidden fees within your contract, and make sure you fully understand them before you sign.

Is Credit Insurance Mandatory?

Although credit insurance is not federally mandated, your lender might insist that it becomes part of your negotiation. If you already have another insurance policy that effectively offers the same coverage, it would be wise to stick with your initial plan. Talk to your lender about credit insurance and find out if it is a requirement of theirs.

If you are looking for an auto loan, call GCS Credit Union at (618) 797-7993. Our credit union in O’Fallon is happy to help you find auto loans that meet your needs. We also offer home mortgage loans and online checking accounts. Feel free to visit our website for more information.

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