Navigating Car Financing Options at Your Chrysler Dealer

May 27th, 2024 by

Buying a new car is an exciting experience. But if you don’t understand the financing process, it can also be a little intimidating. But the friendly staff at your Chrysler dealer can help, and car financing isn’t as difficult as it seems on the surface. This guide is here to help you understand the process so you can focus on the fun parts of car shopping: picking out your next sweet ride!

Navigating Car Financing Options at Your Chrysler Dealer

How Financing Works

The process of financing a new (or used) car is fairly simple. The car has a certain price, or value, plus taxes and fees, and minus any bonuses or incentives. You offer a down payment, a trade-in, or both. Whatever amount your payment doesn’t cover, you borrow from a lender, and pay back across the length, or term, of the loan (plus interest). The less you borrow, the less you have to pay off, and the lower your payments will be.

You benefit because you don’t have to pay tens of thousands to buy a car outright. The lender charges a fee, in the form of interest, to lend you the money. The interest rate they can offer you is based on a number of factors, one of which is your credit score. The higher your score, the lower the risk that you won’t repay the loan, the better rate they can offer, and the less you’ll pay overall.

Four Crucial Car Shopping Decisions

When you step onto the lot with your Chrysler dealer, it helps to know what you’re looking for, and making decisions beforehand can help make the buying process fun and enjoyable. Now that we’ve got the basics of car financing under our belt, it’s time to explore four decisions that can help guide you to an excellent shopping experience that also meets your budget.

Decide: New or Used?

The first decision to make in the financing process is whether you’re looking to get a new car or a used one. Both have their upsides. Cars tend to depreciate, or lose their value, quickly in the first few years off the lot, so used cars can be more affordable, both to purchase and to insure. Value-focused buyers often choose models from 2–4 years ago for this exact reason.

Buying new has its upsides too, though. You’ll pay more, sure, but you can get exactly the vehicle you want, and you also have absolute certainty over how the vehicle is cared for. You also get the most out of the warranty, since that won’t expire for years yet, whereas a used car may already be out of warranty. Also, bear in mind that only new cars are eligible for leases; used vehicles are almost always purchased.

Decide: Lease or Buy?

Leasing tends to be an attractive option for those who always want to drive the next, newest car. Because lease payments are usually less than loan payments, lessees can often afford higher trims or nicer rides than their purchasing counterparts. Your Chrysler dealer will also usually handle routine maintenance, making leasing a low-worry option.

The main upside to buying, on the other hand, is that you own the car; every payment, while higher, goes toward equity in the vehicle. There are no mileage restrictions, no worries about “wear and tear” that can add cost to the end of a lease, and no time limitations. You can sell your car whenever you like, while returning a lease early often comes with a penalty.

Decide: Long Term or Short?

Generally speaking, the shorter the term of a car loan, the more you’ll pay each month, but the less you’ll pay overall The interest your lender charges doesn’t have as long to accumulate, so you’ll pay less for the vehicle overall. Of course, the upside of longer loan terms is a lower monthly payment, leaving more budget flexibility if month-to-month expenses fluctuate.

Decide: How Much Down?

The more you pay up-front for a loan or a lease, the less you finance through the bank. That leads to lower monthly payments and less interest overall. The trade-off, of course, is that you have to gather more up-front for the down payment. This really comes down to priorities. Is it more important to keep your cash reserve high, or to pay less for the car overall?

Two Important Steps

Now that you’ve made some fundamental buying decisions, it’s time to get the process started! These two pre-purchasing steps can fast-track your buying experience and put you in a great position when it comes to car financing.

Pre-Value Your Trade-In

If you’re planning to trade in your current car to offset the cost of a new one, then it’s important to know how much that trade-in will be worth. The good news is that at Auffenberg Chrysler of Herrin, we’re always on the hunt for great used vehicles. Our website makes it quick and convenient to reach out to our team and find out what your trade-in will be worth so you know what to expect when you come in to buy your next car.

Get Pre-Approved

It’s important to get a sense for exactly how much car you’re able to afford so you can narrow your shopping list to vehicles within your price range. A great way to do this is to get pre-approved for an auto loan, and our website makes this process quick and easy. Our credit application is secure, and our financing experts help you get pre-approved for a loan, making the shopping experience quick and easy.

Bad Credit? Not an Issue

The simple truth is that not everyone has always had a stellar track record when it comes to making payments on-time, every time. Bad things happen, from bankruptcy to delinquency, or even vehicle repossession. Whether there have been health concerns, income hiccups, or other challenges in life that have led to some challenges keeping your credit score high, our team is empathetic to your situatio.

So visit Auffenberg Chrysler of Herrin in Herrin, IL, and let our team help you find your next fantastic car so you can drive away happy. 

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