Buying a Car Doesn't Have to Break your Budget
Looking for a new auto this spring? Avoid getting in over your head by following these simple guidelines when car shopping for auto loans in Central Indiana.
Don't buy more than you can afford.
As a rule of thumb, your total car expenses should be no more than 25% of your household income, and that includes your loan payment, insurance, fuel and maintenance for all cars in your household.
Sell your vehicle outright, especially if you are upside down on it.
If unsuccessful you can still finance a new vehicle up to 120% loan-to-value which absorbs your negative equity. Given the low interest rate environment, your auto loan payment can still be manageable in spite having to pack in the negative equity on the trade in.
Consider extending the term of your contract by 6-12 months to make Mechanical Breakdown Protection fit into your budget.
Cars are built to last longer with the average age of a vehicle in our driveways being almost ten years old. You can still finance your car for 5-7 years and have three or four years of no car payment. This saved money can go towards the down payment of your next car.
Avoid paying out-of-pocket expenses if you have an accident or if your vehicle is stolen.
Consider buying Guaranteed Asset Protection (GAP) coverage from Financial Center, an Indianapolis credit union, which covers any difference between what you owe on your auto loan and how much the insurance company values your automobile for.
Ask for Financial Center when shopping for your next car.
Click here for a list of all the local auto dealers who offer Financial Center auto loans. Financial Center offers very competitive Indianapolis loan rates, low fees, and excellent member service. And if you buy soon, we'll even make your first payment for you!