The Cost of an Auto Loan in Columbus

The main factors that will determine the cost of your vehicle are Principle, Down payment, trade, and interest. The principle is the amount owed to the lender after the initial purchase, accounting for any down payment and trade-in credit. The lower your principle, the lower your payments. You can lower your principal by making a down payment. Alternatively, if you trade in a vehicle any value you receive will reduce principal cost. It is recommended to put  20% of the total cost down when buying a new vehicle and 10% down on a pre-owned one. Finally, the interest rate, which will be determined by your credit history, will determine the cost of your monthly payment. Most car loans offered in Columbus are “Simple Interest” meaning the faster you pay the loan, the less interest you pay. The max interest rate for used cars in Ohio is 25%. Find the best interest rates near you

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Shopping For Used Cars in Columbus

​According to Experian, over 85% of new vehicles purchased are financed. When considering financing a new vehicle in Columbus it is important to consider depreciation. Edmunds reports that a vehicle can lose up to 9% of its true market value the moment you drive it off the lot. Most buyers in Columbus choose to purchase pre-owned vehicles. While you may miss out on some warranty and that new car smell, buying used is often more financially sound. Most of those who avoid used vehicles do so due to the stigma that they will be swindled in some way. In today’s market, buyers in Columbus enjoy many legal protections against misrepresenting goods, and consumers have access to a wealth of resources. The financial aspect, combined with the peace of mind provided by technology explains why used vehicles make up almost 60% of the vehicle financing market

 

Do You Need a Down Payment?

​If you cannot afford a down payment or simply want to finance the whole of your vehicle you may want to learn how to avoid making a down payment on your next vehicle. The terms of your loan, in particular of your approval would mainly depend on your credit score. Boosting your score is the best way to avoid or lower down payment requirements. Another option may be getting a co-signer. This can help you get approved for better terms and may lessen the need for a down payment. Be sure to shop around and check the terms of different lenders, just because a certain lender does not approve you without a down payment does not mean that no one else will. Making no down payment is not usually recommended and making even a small down payment is better than none. Both online lenders and buy-here pay-here dealers offer no down payment programs.

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