Auto Buying Expert: Deciphering the Numbers
Are lower auto loan rates really a money saver?
With the holidays right around the corner, we’ll likely continue to see low auto loan rates in the market. Are these low rates really a money saver though? I take a lot of calls in that regard, including questions from members considering a new vehicle so they can get a lower rate. Even with a lower rate, the new vehicle can come at a higher price.
To put things in perspective: If you finance $25,000 for 72 months at 6.74% Annual Percentage Rate, your loan payments would-be $423.17 a month. In total, you would be paying $5,460.08 in interest for a grand total of $30,460.08.^
Let's break down the costs for a loan with a higher interest rate, but a lower loan amount. For a $21,000 loan for 60 months at 7.74% APR, you would spend $423.24 per month. After everything, you would pay $4,394.02 in interest for a total cost of $25,394.40^ for your new vehicle.
Tip: Don’t let the loan rate affect your decision. Take the time to look at the numbers -- and the best way to do that is to call Fox first. We can help you decipher the rates and navigate the financing process. And as always, don’t hesitate to contact me. I’m here to help answer any questions you may have.