Important information about your credit and obtaining an auto loan in Arizona
On average, these auto financing interest rates and credit score pairings are common:
• 850 – 740 credit score: 3.2% interest rate for auto financing loan
• 739 – 680 credit score: 4.5% interest rate for auto financing loan
• 680 and below credit score: 6.5 - 24.9% interest rate for auto financing loan
Your credit score should be in the 740 range if you want to be approved for an auto financing loan with a really low-interest rate. You can still get great low rates if your credit score is in the high 600s. However, your interest rate will just be higher. Auto-finance companies may consider you a "subprime" borrower if you have a credit score of 620 or below. You can still qualify for a subprime auto loan with a credit score of 620 or below—the loan will just have a higher interest rate. Subprime auto financing can help you mend your credit while helping you buy the car you need. You should check your credit score online before you visit a lender for auto financing. Checking ahead of time can ensure you are being offered the interest rate that is right for you.
Loans for used cars near Prescott Valley, Yavapai County, Arizona, Chino Valley, Dewey, New River, Cordes Lake, Spring Valley and other Arizona towns.
For a used vehicle purchase in the Prescott Arizona Area, the average auto-financing loan is around four to five years. Typically, auto-financing loans for used vehicles will require higher interest rates than the interest rates for new vehicles. Also, auto financers are not likely to offer seven-year loans on older vehicles. This is because a vehicle’s value decreases significantly by the time it is ten years old. Trade-in values are not good on older cars.
What loan works for you?
You must choose the loan that works for you and your financial situation. If you can afford it, you should go with the shortest auto loan. You will pay off your car loan sooner if you do this. But if you think that it will be hard for you to go with the shortest auto loan, you should not feel forced to make it work. Making your loan payment each month should be your priority. Making your payment every month helps your credit and could help you with future car loans.
When we buy a car, the auto financing part of the purchase can be overwhelming. You may see an ad with an auto-financing rate, but its small-print disclaimer explains that it is only applicable to qualifying customers. As these ads show, auto financing is not a one-size fit all process. Because we all have different credit histories and financial situations, it is important to consider your financing network of auto dealers, banking institutions, and credit unions.
Oxendale Auto Center in Prescott Arizona may offer incentives for financing auto loans through them. Dealership financing is super appealing because it offers you easy one-process shopping experience. It may be less stressful to secure financing at the dealership instead of worrying about going to another place to obtain financing. Evaluate what is important to you. While we all want to save money, you should be honest with yourself—what do you want your buying experience to entail? What will make you feel the least stressed?