How Does Financing a Car Work?

If you are in search of a new vehicle in the Wichita or Derby area, you may be wondering what your options are when it comes time to make a purchase. What does it mean to finance a car, and how does financing a car work? The team at Don Hattan Dealerships is here to explain the basics of how car finance works so you can determine if it’s the right choice for your driving needs and budget. We can then help you secure some of the most competitive rates around.

So, what does it mean to finance a car? When you finance your vehicle, you are taking out a loan that you will repay over time. A financial institution will lend you the money you need to buy the car. In turn, you pay the lender interest and potentially other fees to borrow that money over a set number of months.

How does financing a car work? First, you will need to apply for the loan through the dealership, a bank, or a credit union. The application can be started online, or you can apply for a loan at the dealership. The lender will look at several key factors when deciding whether to approve the application:

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

If you are approved for a loan, be sure to thoroughly consider all of your options and make sure you understand all the terms of the loan. If the dealership offers in-house financing, you can compare their offer to a bank or credit union offer to see which is the best investment for you. Consider how much money you can put down and how much your monthly payments will be. You want to be sure that you are able to make each payment on time.

In some cases, you can try to negotiate the price before signing on the dotted line. If this is the case, you and the salesperson can go back and forth until you settle on a loan with an interest rate that works for you. When you have reached an agreement on price, you can finalize the loan terms and close the deal. From there, you can sign all the necessary paperwork, take delivery of the vehicle, and drive home in your dream car!

So, how does car financing work? It is a simple and straightforward process at Don Hattan Dealerships. Our team is here to guide you through it every step of the way and answer any questions you may have.