Credit Union Auto Loan
There was time when a loan was not heard of. The word was “if you cannot pay cash, you don’t need it.” Now, unfortunately the cost of everything you need is high and paying cash in not feasible. Therefore, if you need anything large like your house or your car you search for a mortgage or a car loan. Where do you search? You search for your car loan for a bank, a dealer or a credit union. They each have their own policy for loaning out money but all of them look for that all important credit rating and credit score.
What is a credit union? It is a financial institution that is made up of a group of people that have a common bond such as a church, a business or a union. These people pool their assets and make loans to each other. The members of it are not shareholders. It pay dividends to their members and extend loans at lower rates, higher savings rates and less service fees.
Credit unions were responsible for 16.9 percent of all auto loans in 2007, and $18.199 was the average used car loan. Credit unions are not-for-profit and their terms are better having lower interest rates.
Because used car loans are more than five years indicates that people are out buying used cars they cannot afford and consequently, also paying more for them. What does this mean in numbers? For an example: If you were to borrow $16,000 for four years (48 months) at an interest rate of 7.7 percent you would pay $388.36 per month and your total payments would be $18,641.16. If, for the same loan amount, you took a sixty month loan then your monthly payments would be $322.13 but the total payments would be higher at $19,327.80. What this means is that with the long term lease you would be paying about $700 more while with the short term lease you would save $60.00 per month.
If you are looking for a credit union, the Credit Union National Association has a website and would be happy to help you.
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