Find the Best Auto Loan Companies in Beaver Dam, WI

Comparing auto loans in Beaver Dam

One of the most important steps in finding the right auto loan for you is shopping around and getting multiple quotes from different lenders. Ask friends and family what lenders they’ve used to finance their cars, and check online reviews. As you do your research, ask about different aspects of the loan, such as:

• Term length: The term length refers to how long you have to pay back your loan. The shorter your loan term, the greater your monthly payments. The most common term lengths are 24, 36, 48, 60, 72 and 84 months.
• Down payment: Just like with a mortgage for a home, the more you put down upfront, the lower your monthly payments. If possible, take the time to save up money for a car loan down payment. Different lenders have different requirements for down payments.
• Taxes and fees: Vehicle purchases come with taxes and fees. Fees to look at include origination fee, registration and title, late payment fee and prepayment penalty.
• Interest rate: One of the most important things to consider when applying for a car loan is the interest rate. Your interest rate will depend on your credit history, your debt-to-income ratio, the loan amount, the loan term and whether you are buying a new or used car. The national average interest rate for car loans is between 4% and 5% at the time of publishing.

You can get an auto loan from a traditional bank, an online lender, your local credit union or the car dealership/vehicle manufacturer. No matter where you get your loan, it is important to calculate the total cost of the loan. You can use online calculators to determine how much you will end up paying on a particular loan.

For example, say you wanted to buy a used 2018 Chevy Malibu for $23,000. With an interest rate of 4% and a 60-month repayment term, you would end up paying back $25,440, with monthly payments of $424.

If you were to adjust the interest rate to 3%, you’d make monthly payments of $414, saving $600 over the life of the loan. The difference in interest rates can save you hundreds or even thousands of dollars, which is why it is important to get quotes from different lenders.

How to get a car loan in Beaver Dam

Before you reach out to a lender, there are a few things you can do to improve your chances at qualifying for a car loan:

• Improve your credit score: Your approval for a car loan depends significantly on your credit score. It can be more difficult to qualify for a car loan if you have below-average credit, and you can negotiate more flexible terms if you have a higher credit score. Paying off debt or repairing credit are good ways to improve this score and qualify for better loan terms.
• Have proof of income, identity and residence: When it's time to apply for a loan, you will be expected to produce evidence of your income, your identity and your place of residence. Having this documentation together, including bank statements and your Social Security number, when you go in to apply for a loan will save time.
• Get preapproved: The preapproval process will help understand what you will qualify for when you do officially apply for a loan. Getting preapproved shows you how much you are eligible to borrow and the financing costs, and it shows the vehicle seller that you are serious about making a purchase.
• Save for a down payment: Another thing you can do to speed up the loan qualification process and lower your monthly payments is save up for a substantial down payment. The more money you can put down upfront, the less you'll have to pay back and the lower your interest rates and monthly payments.

Beaver Dam auto loan FAQ

Can you get a car loan with bad credit?

Yes, many lenders specialize in offering car loans for people with bad credit. Remember that if you have bad credit, you will pay a higher interest rate and a greater annual percentage rate (APR) on the loan.

What is the average monthly car payment in Beaver Dam?

The average monthly payment for car loans in Wisconsin is $327 on used cars and $523 on new cars, according to AutoWise.

When should you refinance your car?

If your car payments are draining you financially, refinancing your loan may help you lower your monthly payment. If you're having trouble paying your existing car loan or if the interest rate is too high, ask your lender what your options are for refinancing.

What is a good APR for a car?

At the time of publishing, the national average interest rate for borrowers with fair to excellent credit on car loans is 4% to 5%. Anything lower than that is considered a good interest rate.