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How an Auto Loan Calculator Can Save You Money at the Dealership


When it comes to buying a car at a dealership, you have everything to gain from getting prepared ahead of the sale.

Being prepared to purchase includes having all the information you need about the car you want to buy and how much car you can comfortably afford. Using online resources, you can figure out what car you want, how much it costs, how much you will have to pay monthly, and how much car loan you qualify for – all before arriving at the car dealership.

It’s not wrong to want a new Tesla Model S for the price of a used Ford Taurus – it’s just not part of an economic reality. Before approaching a dealership, educate yourself a little bit on the current retail prices of cars you like – compare their features too.

A more realistic scenario might be that you add additional features to the car and a variety of warranties. Then, you realize how much the monthly payment will be as a result. With proper expectations and thorough research, you are less likely to be charmed into buying an unaffordable car.

To help you understand what you can afford, try using an auto loan calculator online.

Steps Toward A Car Purchase

  1. If you’re unsure of what car to buy, check out PrimeWay’s Auto Center to locate cars of interest with comparable features, and pricing.
  2. Open up the car loan calculator and enter in the car’s total purchase price, the loan term in months, and an estimated interest rate. Your monthly payment automatically calculates, giving you an idea of how much you would spend if you bought a car at this price and interest rate at the dealership.
  3. Once you’ve done your research, and assessed how much car you can afford, take your research to the car dealership to shop with laser focus.
The Car You Want at a Rate You Can Afford

Assessing a Comfortable Monthly Payment

If the monthly payment amount looks like it’s too much money to pay per month, consider a larger down payment or look for other vehicles with comparable features that are less expensive. The interest rate will have a lot to do with the cost of your monthly payment. You may be able to receive a lower monthly payment on a loan for a car if you have a lower interest rate and a higher down payment.

Add a Larger Down Payment

By paying as much as you can in cash upfront in a down payment, you are paying down the car’s principal amount before interest has a chance to accrue. With a larger down payment, you will reduce the amount of money you’ll be charged interest for every month. You will save money you would otherwise spend on interest tied up on a 48 or 72-month car loan.

Allow the Car Loan Calculator to Guide You

Knowing your car loan budget before you get to the dealership saves you time and ensures a greater shopping experience for you. With your budget and price known beforehand, you will keep yourself from falling into certain pitfalls when you are at the dealership. By using a car loan calculator, you can enter in different amounts of the car’s total purchase prices to see what you can afford. You save yourself money by knowing ahead of time what you will pay for the car that you want.

Try an Auto Loan Pre-approval

Going into a car dealership prepared will help you navigate the purchase of the car, and help you know what your limits are in the face of enticing additional features and added warranties. You will have researched the price of the car you can afford and know what consequences in terms of high monthly payments if you go over your monthly car note budget.

If you really want to get ahead of the game, talk to your trusted PrimeWay financial advisor about getting pre-approved for an auto loan. The application process is simple and shows you so much information about how much car money you qualify to borrow, and at what interest rate.

Those two factors can greatly influence your decision making when it comes to buying a car – all before you’ve even set foot on a car lot.  Also, if you’ve already been pre-approved for a loan, you might be less tempted to say yes to add-ons because you know how much you have to spend.

How an Auto Loan Calculator Can Save You Money at the Dealership

When it comes to buying a car at a dealership, you have everything to gain from getting prepared ahead of the sale.

Understanding Insurance & Additional Warranties

When it comes to choosing additional insurance, be sure to understand what these forms of insurance actually cover. Also, understand how it could benefit you. Then, see if the vehicle's overall insurance plan already covers (at a better price) items detailed in the additional insurance. Here are a couple of forms of insurance that could save you money in case unplanned accidents or damage occur:

Gap insurance protects you financially when you owe money on a depreciated vehicle. It is needed if you would owe more on the car than the re-sale once you drive off the lot. For example, if you are still making payments on your car loan, and you get into an accident that totals out your car, Gap insurance could make up the difference of what you owe on your car note, based on the value of your car at the time of the accident.

Check out the value of your car for yourself by accessing the Member Auto Center at PrimeWay, or ask PrimeWay for more information.

Mechanical Breakdown insurance is an additional warranty that could cover mechanic services that are not covered by your manufacturer’s warranty. How do you know if you need Mechanical Breakdown insurance? It depends on how good your manufacturer’s warranty is and what it covers. Be sure to read your manufacturer’s warranty to see what the warranty covers.

From there, you’ll know what you might be missing that Mechanical Breakdown insurance could cover. Don’t wait too long to decide on signing up. Often, you are required to add this additional warranty before your manufacturer’s warranty expires. There are third-party warranties you can add on later. Whatever you do, read these warranties to ensure they meet your needs.

Going into a dealership knowing exactly what you want and what you can afford leaves little to haggle with. You’ll be equipped to make decisions based on your need, your future with your vehicle, and without adding on services or warranties, you don’t need that could make your monthly car note larger than it needs to be. Create a car purchasing process as stress-free as possible with help from the financial advisors at PrimeWay Credit Union.

Author Bio

Andreana Binder

Andreana always looks for ways to make life better through good food, exercise and creative flow - that rarely stops! A corporate writer by trade, Andreana also enjoys teaching workshops, making art, blogging, and sharing good food with friends and family. You can find Andreana soaking up the sun at the park with her mini schnauzer Murdock in her free time when she's not writing, cooking, creating or watching scary movies.

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