Before accepting an auto financing offer, check the APR, interest rate, loan term, monthly payment, total repayment amount, and all applicable fees. Make sure you understand whether the rate is fixed and whether there are any conditions attached to the offer.
Also confirm the actual amount being financed. Dealer paperwork can include taxes, registration, warranties, optional products, service plans, and other charges. Make sure you know which items are required and which are optional before signing.
Don’t let the conversation focus entirely on the monthly payment. A dealer can make a payment appear lower by extending the loan term, but that may increase your total interest cost.
Compare the financing offer with any preapproval or outside lender quotes you have received. Finally, verify that the vehicle price, trade-in value, down payment, and loan terms shown in the contract match what you agreed to.
If you’re unsure what lenders consider when reviewing an application, our guide to auto loan approval factors can help you prepare.
