So How Does Car Financing Work?

Hands Doing Calculations with Calculator

 

What does it mean to finance a car, and how does financing a car work? There are three main ways to buy a car: purchase it outright with cash, lease it, or finance it. Financing a car is a very common process, including in Lakewood. Financing a car is the process of getting a loan for a car purchase. Read on to learn more about how car finance works, from the experts at Tacoma Dodge Chrysler Jeep Ram. Contact us for more information!

How Car Finance Works

To attain a car loan, first you must apply for a loan through a dealership, bank, or credit union. A good tip is to apply to several institutions at once, not just to shop around, but so that it only counts as a single credit pull event. Lenders look at factors such as the following: 

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

How Car Finance Works: Select Your Lender

Once the lender’s offers come in, compare them thoroughly to choose the best option for you. Putting more money down up front will not only make your loan total smaller, but will save you money in the long run. Remember that the total amount you will pay monthly on the car is not just the car loan, but insurance, gas, and maintenance as well. 

How Car Finance Works: Finalize the Loan Terms

Before finalizing the loan using it to buy a car, negotiate on price and interest rate to the best of your ability. Once this is done to your satisfaction, you can finalize the loan terms and complete the deal. Once you sign the paperwork and take delivery of the vehicle, you’re free to cruise the streets of Spanaway!

Learn More About Car Financing with Tacoma Dodge Chrysler Jeep Ram!

Be sure to check out our value your trade tool and vehicle finder service to help you plan for your next vehicle! We offer assistance to all Gig Harbor drivers and beyond. Do you have more finance questions? Take a look at our Car Buying Tips where your can learn the advantages between buying or leasing or if you can trade in a financed car and much more.

More from Tacoma Dodge Chrysler Jeep Ram

  • 2023 RAM 1500 Towing Capacity and Payload

    Year after year, the RAM 1500 proves itself a dependable and capable pickup truck for work sites and adventures alike. The 2023 model continues this tradition. It is prepared to tackle any tough task, and it provides the latest technology to ensure that you can tow confidently and safely. So, how much can a RAM…

  • 2023 Jeep Wrangler 4xe Specs

    A plug-in hybrid version of the all-terrain champ, the new Wrangler 4xe is an exciting addition to the lineup. The 2023 model comes in four trim levels, each equipped with a turbocharged four-cylinder engine and two electric motors. Curious about the 2023 Jeep Wrangler 4xe specs? Check out this guide from Tacoma Dodge Chrysler Jeep Ram to learn about…

  • 2023 Jeep Wrangler 4xe Towing Capacity

    Legendary capability electrified — the 2023 Jeep Wrangler completely changes the way you can adventure around Spanaway. This model features hybrid innovation to maximize efficiency without sacrificing all that the Wrangler is known for. In fact, the 2023 Jeep Wrangler towing capacity proves that the Wrangler is up for whatever challenge lies ahead. Learn more…

Tacoma Dodge Chrysler Jeep Ram 47.21937, -122.4840714.