Seven-Year Car Loans More Popular, but Beware

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Those loans, they're getting awfully long. Experian Automotive says that in the first quarter of 2014, 24.9 percent of all new-car loans were 73 to 84 months long. Four years ago, less than 10 percent of loans were that long. In fact, such lengthy terms have pulled the average new-car loan to 66 months. That's an all-time record.

Related: Deferred Car Payments: Read the Fine Print

As credit continues to open up — and, some argue, automakers try to maintain the past year's sales growth — car loans continue to lengthen. But make sure you consider the terms carefully, because even if you can get a longer loan it doesn't mean you should.

By Kelsey Mays | September 5, 2014 | Comments (5)

Deferred Payments: Read the Fine Print

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Until someone downs that last Labor-Day brat, Fiat Chrysler Automobile's Summer Clearance event will allow you to finance a new Chrysler, Dodge, Jeep, Ram or Fiat without car payments for the first 90 days. Chevrolet's Labor Day sale has a similar deal: Finance a new Chevy, and you can take three months off before your first car payment.

Sounds pretty good, right? Not so fast.

Related: Chevrolet, Ford Kick off Labor Day Sales Early

Make sure you read the fine print. Deferred payments might seem like a win-win, but the terms can vary — and the details make a big difference in how smart it might be to put off those payments.

By Kelsey Mays | August 26, 2014 | Comments (1)

Toyota Offers Payment Relief for Furloughed Federal Workers

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Another automaker has pledged assistance to customers directly impacted by the prolonged shutdown of the federal government — now entering its third week with 800,000 workers furloughed and 1.3 million more still active but potentially not receiving a paycheck anytime soon. Toyota announced Monday it is offering payment relief to owners who finance their vehicles through the automaker.

The offer extends to any Toyota or Lexus customer "financially burdened by the government shutdown, including furloughed workers, businesses and employees of businesses directly affected by the shutdown, government contractors, and suppliers," the automaker stated. Customers whose accounts are in good standing with Toyota Financial Services or Lexus Financial Services may be able to defer up to three months of payments.

By Matt Schmitz | October 15, 2013 | Comments (1)

Will 2013 Chevrolet Corvette Prices Drop Now That the 2014 Corvette Stingray Is Available?

"Will 2013 Chevrolet Corvette prices drop when the 2014 is available?"

Steve

By Rick Popely | October 5, 2013 | Comments (0)

Hyundai Revives Payment Assistance Amid Federal Shutdown

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Lights remained out in public buildings and stocks plummeted Wednesday morning as the first federal-government shutdown in nearly two decades continued into its second day. With no apparent signs of resolution in Congress to put 800,000 government employees back to work, one automaker announced a plan to help ease the financial woes of those workers whose incomes would be diminished by the shutdown.

Hyundai has expanded its Assurance program to include loan-payment deferral for federal workers furloughed during the shutdown. The automaker will extend all auto-loan and lease payments for the shutdown's duration for current Hyundai owners who are impacted by it. Moreover, sidelined federal workers who wish to buy a car this month will be offered a 90-day payment deferral.

By Matt Schmitz | October 2, 2013 | Comments (2)

How to Negotiate Car Financing

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Negotiating car price and financing is like a game. And like any game, your odds of success improve if you go in with a solid plan. Before ever touching grass on the field of play — the dealership — drill yourself: How much can you actually afford? How much should your desired car cost? At what price will you start negotiations? What's the max price you're willing to pay versus the one you tell the dealer? Follow the link below for a deeper dive into our personal playbook, and get ready to watch your auto-financing highlight reel after the deal is done.

Auto Finance Game Plan

By Matt Schmitz | September 14, 2013 | Comments (0)

How To Find The Right Car Loan

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If you're among the vast majority who borrow money to purchase a vehicle, you'll want to be armed with as much info — about you — as possible when loan shopping. You need to know not only what kind of car you can afford but also ongoing costs like gas, insurance and maintenance. It's also wise to head into a lending institution understanding as much as possible about your own finances, including credit rating, income, monthly expenses and debt. Follow the link below for our advice on best loan-shopping practices.

Car Loan: What You Need to Get One
By Matt Schmitz | June 30, 2013 | Comments (2)

Tips to Navigate the Dealer Finance Room

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You've finalized your car selection, haggled with the salesman and settled on a price. Now all that stands between you and your new wheels is the finance and insurance room, where dealerships offer financing, warranties, rustproofing and other add-ons. It's important to have shopped around before you enter this room to ensure you're getting the best financing. You'll also want to go in confident of what you want and don't want to avoid feeling pressured by the lure of extras. Follow the link below for advice, and you'll leave the room stress free and ready to roll.

Inside the Finance and Insurance Room

By Matt Schmitz | June 29, 2013 | Comments (1)

Study: Many Average U.S. Households Can't Afford a New Car

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Do you live in one of the largest metropolitan areas in the U.S.? If so, there's a decent chance you can't afford a new car, according to a report by Interest.com, a consumer financial information website. It concludes that out of the nation's 25 largest metro areas, a median-income household can only afford an average-priced new vehicle in just one of them: Washington, D.C. The analysis considered three key factors: a 20% down payment; financing for no longer than four years; and principal, interest and insurance totaling no more than 10% of a household's gross income.

"What this research indicates, more than anything, is that a lot of Americans are spending too much money on their cars," said Mike Sante, Interest.com managing editor, in a news release. "Car costs are one of the most controllable parts of a household's budget. … You're better off driving something more affordable and saving or investing the difference."

Assuming an average purchase price of $30,550 and a monthly payment of $601, the median income of our nation's capital afforded its residents a $628 monthly payment. San Francisco and Boston came closer than most, but still fell short with $537 and $507, respectively.

By Matt Schmitz | February 27, 2013 | Comments (23)

Signs Suggest Automaker, Consumer Confidence Rebound

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If it can be said that "as car buying goes, so goes the economy," then Americans' confidence in their spending power appears to be improving. As auto-loan delinquency decreases overall, borrowers are taking on greater debt for vehicle purchases and more loans are being initiated.

According to USA Today, TransUnion, one of the nation's largest credit bureaus, reported that the rate of loans delinquent by 60 days or more finished 2012 at 0.41%, a 5 percent decrease from the same time a year earlier. Meanwhile, debt per borrower rose for the seventh quarter to $13,747, up more than 5%, from last year's end.

Auto-loan delinquencies had previously fallen to historic lows in August 2012, when they were 0.33% of all outstanding automotive loans. That rate was about 25% lower compared with the previous year.

Related
Auto Loan Delinquency at Lowest Levels Ever (USA Today)
More Car Shoppers Leasing Again
More Finance News on Cars.com
By Matt Schmitz | February 27, 2013 | Comments (0)

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