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Your interest rate on a car loan makes a big difference in the final price tag. How do lenders determine auto loan rates? Big hint: it all comes down to numbers.
Credit Score
Your credit score is most important. It’s the number one indicator of how likely you are to repay the loan. The higher it is, the better, and it’s the biggest thing that lenders look at.
Loan Amount and Down Payment
Lenders like large down payments and lower dollar amounts. The more money you can pay upfront, the lower your interest rate will be. Figure out
how much you can afford to spend.
Debt-to-Income Ratio
If you already have a lot of other outstanding debt, you may appear more risky. Show high available income and low outstanding debt, and lenders may offer a more attractive rate.
Loan Terms
Interest rates for used cars are higher than for new cars because it’s more profitable for dealers to sell new vehicles. And, longer-term loans will likely have higher interest rates than short-term loans.If you’re checking out car loan rates in Streamwood or Schaumburg, visit Elgin Toyota for all the
info you need. Fill out a credit application
online today!
