How Does Financing a Car Work?

If you are looking to upgrade your Halifax commute with an exciting new Ford car, SUV, or truck, you’ll want to learn more about how to finance a car. So, how does financing a car work, and what does it mean to finance a car? This guide from the Finance team at MacPhee Ford will walk you through the car financing process so you can get the deal that is the best fit with your budget.

What Does it Mean to Finance a Car?

When you finance a car it means that you are borrowing money to put towards the purchase or lease of a vehicle. Typically you will secure the loan through a local Bedford-area bank or credit union, or through a dealership like MacPhee Ford. Either way, you will be required to pay the loan off in installments.

How Does Car Financing Work?

Once you have found a vehicle you wish to purchase or lease, you can apply for a loan with the dealership, a bank, or a credit union. Here at MacPhee Ford, we offer a convenient online finance application that allows you to get pre-approved from the comfort of your home or office. Factors that your lender will consider include:

• Credit Score
• Loan Amount
• Length of Loan
• Debt-to-Income Ratio
• Age of the Vehicle (if you are purchasing a pre-owned vehicle)

Your credit score is the real key here as to what kind of interest rate you will get. If you don’t have a strong credit history or are a first-time buyer, you may want to consider asking a family member or close friend to cosign your loan.

Choose Your Lender

If you have received approval from a few different lenders, compare the offers to see which makes the most sense for your budget. Determine how much you can put towards the down payment and decide whether the monthly payment schedule fits your budget. You can use the MacPhee Ford online payment calculator to find out what your monthly payments will be, and if you plan to trade in your current vehicle to help cover your down payment, our online trade-in estimator can give you the fair market trade-in value of your vehicle in seconds. You’ll  find it to be easy and convenient to sell your car at MacPhee Ford.

Finalize the Loan Terms

After choosing the loan offer that works best for your budget, you’ll have the opportunity to negotiate on the price. During the negotiation process you and the salesperson will go back and forth until you settle on a loan amount and interest rate that you can both agree upon. Once this has been worked out, you can finalize the loan terms, sign all the necessary paperwork, and drive home in your new vehicle.

Get Auto Financing Today at MacPhee Ford!

Have further questions on how car financing works? Contact MacPhee Ford or stop by our dealership and discuss your options with our expert finance specialists. Don’t forget to ask about our new Ford specials and current offers and incentives. We want to put you behind the wheel of an exciting new Ford with a finance package that is tailored to your budget, so come see us today!