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Car buying online vs. at a dealership Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our mission is to help you make better financial decisions by offering you interactive tools and financial calculators as well as publishing unique and impartial content. We also allow you to conduct your own research and compare data for free - so that you can make sound financial decisions. Bankrate has agreements with issuers, including but not limited to American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Earn Money The products that are featured on this site come from companies that compensate us. This compensation may impact how and where products appear on the site, such as for instance, the order in which they may appear within the listing categories, except where prohibited by law. This applies to our mortgage, home equity and other home lending products. This compensation, however, does affect the information we provide, or the reviews that you see on this site. We do not contain the entire universe of businesses or financial offerings that could be open to you.

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6 minutes read. Published 28th October 2022

Authored by Rebecca Betterton Written by Auto Loans Reporter

Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers with the ways and pitfalls of using loans to buy a car.

The edit was done by Rhys Subitch Edited by Auto loans editor

Rhys has been writing and editing for Bankrate since the end of 2021. They are dedicated to helping readers gain confidence to take control of their finances with precise, well-studied information that break down complex topics into digestible chunks.

The promise of the Bankrate promise

More info

At Bankrate we strive to help you make smarter financial decisions. While we are committed to strict journalistic integrity ,

This post could contain the mention of products made by our partners. Here's an explanation for how we make money .

The Bankrate promise

Established in 1976, Bankrate has a proven track experience of helping customers make smart financial choices.

We've maintained this reputation for more than 40 years by demystifying the financial decision-making

process, and giving people confidence about the actions they should follow next. Bankrate follows a strict ,

You can rest assured you can trust us to put your needs first. All of our content is authored by and edited by ,

We make sure that everything we publish ensures that everything we publish is accurate, objective and reliable. Our loans reporter and editor focus on the things that consumers care about the most -- the different types of lending options and the most competitive rates, the top lenders, how to repay debt, and more -- so you're able to be confident about making your investment.

Integrity of the editorial process

Bankrate has a strict policy , so you can trust that we put your interests first. Our award-winning editors and reporters create honest and accurate content that will assist you in making the right financial choices. The key principles We respect your confidence. Our mission is to provide our readers with reliable and honest information, and we have standards for editorial content in place to ensure that happens. Our editors and reporters rigorously check the accuracy of editorial content to ensure the information you're reading is true. We keep a barrier with our advertising partners and the editorial team. Our editorial team does not receive compensation directly from our advertisers. Editorial Independence Bankrate's editorial staff writes in the name of YOU - the reader. Our aim is to provide you the most accurate advice to assist you in making smart personal finance decisions. We adhere to strict guidelines in order in order to make sure that the content we publish is not in any way influenced by advertising. Our editorial team is not paid any compensation directly from advertisers and our content is thoroughly fact-checked to ensure accuracy. Therefore, whether you're reading an article or a review, you can be sure that you're receiving reliable and reliable information.

How we make money

You have money questions. Bankrate has the answers. Our experts have been helping you master your money for more than four years. We are constantly striving to provide our readers with the professional advice and tools needed to succeed throughout life's financial journey. Bankrate adheres to a strict code of conduct standard of conduct, which means that you can be sure that our information is trustworthy and accurate. Our award-winning editors, reporters and editors create honest and accurate content to help you make the best financial decisions. The content we create by our editorial staff is factual, objective and uninfluenced through our sponsors. We're honest regarding how we're capable of bringing high-quality content, competitive rates and helpful tools to you , by describing how we earn money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for the placement of sponsored products and, services, or when you click on specific links on our website. This compensation could affect the way, location and in what order items are displayed within the categories of listing and categories, unless it is prohibited by law. We also offer mortgage, home equity, and other home lending products. Other factors, such as our own rules for our website and whether a product is available in your region or within your own personal credit score can also impact the way and place products are listed on this website. While we strive to provide the most diverse selection of products, Bankrate does not include details about every credit or financial product or service.

Should I buy my next car online or at a dealership?

It depends on the type of experience you like. If you like personal contact, dealerships are the preferred option. But if you want to purchase your items at home, stick to the internet.

The past was when car buying required a trip to your local dealership to pick the next car from what was available at the time. Today, drivers can buy cars at the convenience of their own homes and in some cases even get the vehicles delivered. Both buying options come with advantages and disadvantages. Shopping online is convenient, while dealerships allow for negotiations. Think about which one is the best fit for your needs before beginning the process of shopping. Online car buying vs. dealerships Online

Traditional dealership

Advantages

* More vehicle options * Easy to compare cars Attentive customer service

* More flexible prices * Manufacturer incentives Expert advice

Disadvantages

* No test drive * No negotiation * Potential extra fees

* More time commitment It is more difficult to walk away Fewer vehicle options

Good for...

The driver who enjoys the convenience of shopping at home and prefers to stay clear of any pressure from salespeople.

A driver who excels in negotiations and prefers the personal connection that comes with working with a dealer.

What to be on the lookout for

Buying sight unseen can carry additional risk, so do some studies on models to make sure you're getting a good vehicle.

and marked-up financing can undo the hard work you've put into it. The pressure of additional demands can force you into a car that doesn't fit.

Cars can be purchased online in the midst of the pandemic, dealers in the area started to offer alternatives. The customers were able to see the cars available in the area prior to heading out to the lot. While this remains a great option to shop online, it will require a visit to the dealership. However, other options for shopping that are more convenient are gaining popularity as local dealerships have shifted to online shopping due to sheer necessity. Online sellers like , CarMax, Shift and -to name a few enable drivers to shop, and even arrange delivery or pickup all from home. Benefits of purchasing cars online The primary advantages of purchasing an automobile online come in the form of ease of buying and online customer support. More vehicle options Local dealerships have a limited selection of vehicles available in the area, and with remaining supply chain issues the availability is even more limited. Shopping online offers a much greater number of vehicles to choose from. You can also filter your search to particular models, brands and prices -- all without the pressure of a salesperson who is constantly over your shoulder. It is easier to compare cars with many vehicles to choose from, comparison is the key to . No matter how many notes you take it's hard to really compare two vehicles on a dealer's lot side by side. On the internet, you can evaluate the features and accompanying costs for all the vehicles you have your eye on. Friendly customer service when shopping at home eliminates the need for interaction with a person, but shopping online still allows for great customer service, based on the company you work with. Many online sellers, such as Carvana, for example have a chat option that allows customers to ask specific questions throughout the process. There are disadvantages to purchasing cars online Although buying an automobile online has the convenience and ease of shopping at your own home, there are some significant negatives to take into consideration. No test drive When shopping online you won't have the opportunity to inspect the vehicle in person until after you sign on the dotted line. In the absence of a test drive, you could buy a vehicle that doesn't fit your needs. When you're online shopping for a car make sure you find sellers who have a return option with a 7-day return time -- so you don't end up with a car you don't want. There is no negotiation. Most online car platforms offer no-haggle prices. For those who are tired of bargaining, this could be a plus. However, it also means you'll not have any wiggle room on the price. When shopping at traditional dealers, it's likely that you will be able to cut the cost through negotiations, however when you shop online, the advertised price will be the amount you will pay. There are a variety of fees to consider. While some fees are not a necessity when it comes to car buying, shopping online can result in some additional costs. If you opt to have your vehicle delivered, for instance, you will have to pay an additional cost that can be as high as $1000 or more on marketplaces like Vroom as well as other handling charges which are usually eliminated when you deal with dealers. When buying a car from an auto dealership. Going to your local car dealer is the best option when it comes to purchase a used or new car. Dealerships cater to specific vehicle brands, prices and vehicle types. But these establishments can carry an unpopular reputation, so it is wise to consider before arriving. The purchase of a car in the present will require some caution due to current high new car prices, caused by supply chain issues as well as . Unfortunately, they aren't likely to return to normal prices until 2023's spring. In the meantime it is important to be prepared to spend some more in the event that you purchase an entirely new vehicle directly from an auto dealer. Benefits of buying a vehicle at a dealership Taking the traditional route gives drivers an opportunity to get the most competitive price as well as the guidance of an experienced salesperson. More flexible prices While the differs from what you may see advertised on the vehicle window, it's likely that with negotiation skills you can reduce the sticker price. This is not a benefit afforded to those shopping at your home. Manufacturer incentives Dealerships often offer buyers promotional finance options or other rebates offered by manufacturers to help sweeten the buying experience them. Although not all of them are the same, most can be used to up the amount of your down payment or even provide you . Professional advice Nothing is as valuable as the personal guidance that a sales associate familiar with the market can offer. This especially rings true if you are looking at different options for your vehicle like . With all the bells and whistles cars are now with, it may be beneficial to find someone guide through the procedure. Disadvantages to buying a car at a dealership The time it takes to buy an automobile can be a large time commitment and cause headaches for buyers who are cautious So, consider the pros and cons of purchasing from a dealer. A longer time commitment when buying online, you can shut down your laptop and have your new vehicle arrive as soon as the next day, however buying from a dealer isn't usually as seamless. It is necessary to carve some time to drive to the dealer lot, walk around to explore the options for your vehicle, and then meet with the salesperson. This entire process can be tiring, and can result in you not having the dream car of your dreams. The harder it is to walk away when salespeople are there to assist you with your car buying journey and having someone at you throughout the entire process can be difficult for those who are in a dilemma. It can also make leaving a deal particularly difficult. If you're not an extremely discerning buyer who is prepared to not say no, you should consider the ease of having the option to shut down the website as well as "walk away" while shopping online. A smaller selection of vehicles dealerships have fewer options than online sellers. Most dealerships offer a particular brand of vehicle. If, for instance, you have your sights for a Nissan but you only have a Ford dealer close by, shopping online is the best way to explore more options. What can you do to get the most deal , no matter what you shop. No matter where you decide to purchase your next car there are a few cardinal rules to keep in mind when you're trying to drive on the road with the best price that you can. Keep your budget in check. Cost should be your top priority when shopping, consider the car loan to know your estimated monthly costs. In addition, you should think about your total costs of owning a car- maintenance and included. Apply in for loan prequalification. Look out for lenders that provide this service, it's a great method to secure your monthly payments and ensure you can afford the car you want to purchase prior to signing. Check for the total amount, not just the monthly payment. The , the lower your monthly payment may be, but it's not always the best choice because you might incur more interest over the long term. Know the credit rating of your. Your serves as the main indicator of your capacity to pay back your loan. Knowing this will put you in a better position to determine whether you're receiving the right rates. Explore the market. It is not just crucial when it comes down to vehicles but also key in obtaining the ideal loan. It is suggested to research before signing a contract. Use cars purchasing apps. Benefit from the latest technology by using it on and off the dealership lot. The apps will allow you to compare vehicles and also provide you with real-time price estimates. Bankrate tip

If you want the most desirable of both, consider talking to the dealership in your area via email in advance. Mention what you're interested in along with your timeline for purchase. You can also inquire about any incentives that are available.

The bottom line is a satisfying and stress-free experience. Therefore, the choice between an online store or dealership depends on what is best suited to your needs. If you'd rather the assistance of a trusted sales associate opt for the traditional method. But if the thought of dealerships brings more fear than excitement, you might want to consider the seamless online process.

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Written by Auto Loans Reporter

Rebecca Betterton is the auto loans reporter for Bankrate. She has a specialization in helping readers with the ins and outs of securely taking out loans to purchase a car.

Editor: Rhys Subitch Edited by Auto loans editor

Rhys has been editing and writing for Bankrate from late 2021. They are committed to helping readers to manage their finances through providing precise, well-researched and reliable information that breaks down otherwise complex subjects into digestible pieces.

Auto loans editor

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How we make money Bankrate.com is an independent, advertising-supported publisher and comparison service. We receive compensation for placement of sponsored products and, services, or by you clicking on certain links posted on our website. Therefore, this compensation may affect the way, location and in what order products appear in listing categories, except where prohibited by law. This is the case for our mortgage or home equity products, as well as other home lending products. Other factors, like our own rules for our website and whether or not a product is available within your region or within your personal credit score may also influence how and where products appear on this site. While we strive to provide an array of offers, Bankrate does not include specific information on every financial or credit product or service. Bankrate, LLC NMLS ID# 1427381 | BR Tech Services, Inc. NMLS ID #1743443 |

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Top advantages to buying a used car Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our goal is to help you make better financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct your own research and evaluate information for no cost and help you make financial decisions with confidence. Bankrate has partnerships with issuers including, but not restricted to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make Money The deals that are advertised on this site are from companies that compensate us. This compensation could affect how and where products are displayed on this website, for example, for example, the order in which they may appear in the listing categories, except where prohibited by law for our mortgage, home equity and other home loan products. But this compensation does not influence the content we publish or the reviews that you see on this site. We do not include the vast array of companies or financial deals that could be available to you. Share: Barry Austin Photography/Getty Images

4 minutes read Read The publication was published on March 02, 2023.

Writer: Rebecca Betterton Written by Auto Loans Reporter Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers in navigating the ways and pitfalls of taking out loans to purchase cars. Edited by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since the end of 2021. They are dedicated to helping readers gain confidence to control their finances with precise, well-studied information that breaks down otherwise complex topics into manageable bites. The Bankrate guarantee

More info

At Bankrate we strive to help you make smarter financial decisions. We adhere to the highest standards of editorial integrity ,

This post could contain some references to products offered by our partners. Here's a brief explanation of how we make money . The Bankrate promise

Established in 1976, Bankrate has a long experience of helping customers make informed financial decisions.

We've maintained our reputation for more than four decades through demystifying the financial decision-making

process, and giving people confidence in the decisions they will do next. Bankrate has a very strict ,

so you can trust that we'll put your interests first. All of our content is written by and edited by

We make sure that everything we publish ensures that everything we publish is accurate, objective and trustworthy. We have loans journalists and editors concentrate on the points consumers care about the most -- the different types of lending options and the most competitive rates, the top lenders, how to repay debt, and more -- so you'll be able to feel secure when investing your money. Integrity in editing

Bankrate has a strict policy standard of conduct, which means you can be confident that we'll put your needs first. Our award-winning editors, reporters and editors create honest and accurate information to aid you in making the best financial choices. Our main principles are that we appreciate your trust. Our mission is to offer readers accurate and unbiased information, and we have standards for editorial content in place to ensure that happens. Our editors and reporters thoroughly fact-check editorial content to ensure that the information you're reading is correct. We keep a barrier between advertisers as well as our editorial staff. Our editorial team doesn't receive compensation directly by our advertising partners. Editorial Independence Bankrate's editorial staff writes in the name of YOU - the reader. Our goal is to provide you the most accurate advice to aid you in making informed financial decisions for your personal finances. We adhere to strict guidelines for ensuring that editorial content isn't influenced by advertisers. Our editorial team receives no any compensation directly from advertisers and all of our content is checked for accuracy to ensure its truthfulness. Therefore whether you're reading an article or reviewing, you can trust that you're getting credible and reliable information. What we do to earn money

You have money questions. Bankrate has answers. Our experts have been helping you master your finances for more than four years. We continually strive to provide consumers with the expert advice and tools required to succeed throughout life's financial journey. Bankrate follows a strict standard of conduct, so you can rest assured that our content is truthful and reliable. Our award-winning editors and journalists produce honest and reliable content that will help you make the right financial decisions. The content we create by our editorial staff is factual, objective and uninfluenced from our advertising. We're transparent regarding how we're capable of bringing high-quality information, competitive rates and helpful tools to you , by describing how we earn our money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or when you click on certain links posted on our site. This compensation could impact how, where and in what order products appear in listing categories and categories, unless it is prohibited by law for our mortgage, home equity and other products for home loans. Other factors, such as our own rules for our website and whether the product is available in your region or within your personal credit score could also affect the way and place products are listed on this site. Although we try to offer an array of offers, Bankrate does not include the details of every credit or financial products or services. Purchasing a used car over an entirely new one is an excellent alternative for many drivers. While rates in the U.S. soar to record levels, Americans are seeing its impacts at the grocery store checkout and at the . With new car costs averaging close to $47,000 as of early 2022 in accordance with Kelley Blue Book it might be the perfect time to save some money and purchase a used . A used car can save you money. Buying a second-hand vehicle instead of a brand new one could save you big bucks in a variety of ways. A used car will cost less than the sticker price alone -- but that's not where your savings stop. It will also mean that you'll reach to your wallet smaller than you would if you owned a brand-new vehicle with regards to fees such as insurance, vehicle depreciation and other fees. The 4th quarter in 2022, the cost for a used vehicle is $526. Those purchasing a brand-new car pay $716, as per . The savings of more than $180 per month can add up quickly and you could save thousands by going for a used car over an entirely new one. While paying a lower cost of purchase for the same model of an earlier year is the most obvious reason to purchase used cars but there are other reasons also. Five benefits of buying used There are many reasons to buy used. Not all used cars are identical. You must before deciding if a used car is in good or poor condition. With that caveat Here are five great advantages of buying a secondhand car. 1. Depreciation of vehicles is a fact of daily driving, however a used vehicle offers much less depreciation than a new vehicle. New vehicles typically appreciate around 20 percent after they've been removed from the dealership. The majority of cars be lost 10 percent in value within the initial year. It's a loss of 30 percent in the first one-year period of ownership. The value of a used car decreases at a much slower rate than a new vehicle. This is because when you're driving of the vehicle, it'll already have experienced the major depreciation. Brand new vehicles depreciate at as soon as they leave the lot However, a used car is more depreciated and this means that you'll have a higher stability for your loan-to-value ratio. 2. Lower insurance costs Insurance costs depend on your experience with driving, your age and rating on your credit, the mileage, and the location. Typically -- just because the car will cost less, the insurance cost for a used car tends to be lower than the cost of a brand new vehicle. A key factor in determining the the value of the car. Because it is less expensive than a more modern version, the price of insurance will be lower. For coverage recommendations for your vehicle, if it is older , you might need to consider liability in the event that your state permits it, versus adding collision and comprehensive coverage when your vehicle is newer. Insurance rates aren't always the same, so in order to save money, make certain to investigate your expected auto insurance cost prior to leaving the lot of the dealer. 3. Lower dealer fees As insurance prices differ by ZIP code, the fees that come with your used car are not identical across all 50 states. But they are less expensive than the fees that are associated with new vehicles because the cost of the vehicle is less than the cost of the vehicle in the first place. This is especially true of any sales tax that you might be required to pay. In order to prepare for the extra fees that come with used to purchase a vehicle, visit your state's DMV site for details on the registration fee and title tax as well as documentation fees. 4. You get more value for your money The ability to stretch your budget for car purchases is another advantage of buying used cars. You can get more cars by purchasing used rather than new. If you have your sights for a luxurious car but you're not able to afford the latest model, however one that's two or three years old may be more suitable for your budget. It is also important to think about the fact that automakers do not have to redesign their models every year, so the tech and design differences could be less noticeable. Estimate the savings you could save and even compare which is right for you with the help of . 5. Peace of mind the past, buying used vehicles was frowned upon and many drivers saw it as a risk, but the availability of car histories has changed this landscape. The drivers now have access to information regarding the car's owner, accident history, status on the title, mileage, and much more. Before you sign off on the purchase of a second-hand vehicle, make use of offerings from websites like Carfax as well as AutoCheck to see history reports for the vehicle. Based on the vehicle's identification number, or VIN. These reports give numerous valuable details including verification of the mileage and whether the vehicle was ever declared a total damage by an insurer. Pre-owned certified if you're still concerned about the possibility of hidden issues in an older vehicle, purchasing certified pre-owned might be the best option for you. You will still save money by buying an older car, but also gain additional confidence in the reliability of the vehicle. Certified pre-owned -- also known as CPO -- programs vary from one manufacturer to the next. In essence, CPO cars are vehicles that conform to a manufacturer's standards and carry some form of guarantee against defects similar to a new-car warranty. For this, you must check inventory at the dealership for the CPO vehicle you are looking for. Each dealership has its own language in relation to used options so be sure to research online prior to going to the showroom. A majority of these cars come with additional warranties. Make sure you check the length of that assurance to find out what it covers. Following steps: Buying a secondhand vehicle is a great way to take the wheel without spending as much as you would for a new vehicle. You will be met with less vehicle depreciation and spend less on insurance and registration while still having confidence that your vehicle is in good working order. When it is time to finance a used car make sure you are current so you know you are getting the best deal available. That's what financing can provide. Leanr SHARE more:

This article is written by Auto Loans Reporter Rebecca Betterton is the auto loans reporter for Bankrate. She is a specialist in helping readers in navigating the details of borrowing money to buy an automobile. The article was edited by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate from late 2021. They are enthusiastic about helping readers gain the confidence to control their finances with concise, well-studied facts that break down otherwise complex topics into manageable bites.

Auto loans editor

Similar Articles: Auto Loans 3 min read Mar 02, 2023. Auto Loans 6 min read December 01 2022. Auto Loans five minutes read Oct 10 2022. Auto Loans 3 min read May 12 2022

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Fifth Third Bank

Fifth Third Bank: 2023 Auto Loan Review Published 2023-01-01 00:00:00

Authored by Rebecca Betterton Written by Auto Loans Reporter

Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers in navigating the ins and outs of securely borrowing money to purchase an automobile.

Editor: Rhys Subitch Edited by Auto loans editor

Rhys has been editing and writing for Bankrate since the end of 2021. They are committed to helping readers gain confidence to manage their finances through providing clear, well-researched facts that break down complicated topics into bite-sized pieces.

Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our mission is to help you make smarter financial decisions by providing you with interactive tools and financial calculators that provide objective and unique content. We also allow you to conduct research and compare information at no cost and help you make informed financial decisions. Bankrate has agreements with issuers including, but not limited to American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Earn Profit The deals that are advertised on this site come from companies who pay us. This compensation can affect the way and when products are featured on this website, for example the order in which they appear within the listing categories in the event that they are not permitted by law. Our mortgage or home equity products, as well as other home loan products. This compensation, however, does not influence the content we publish or the reviews appear on this website. We do not include the entire universe of businesses or financial deals that may be available to you.

About our reviews Editorial disclosure The reviews are written by staff. The opinions expressed are solely the opinions of the reviewer and are not reviewed or approved by any advertising company. The information that is included, including rates and fees provided in the review are accurate up to the date when the review first appeared. Look over the information in the upper right hand corner of the page as well as the lender's website for the most current details.

A glimpse 3.6 Rating: 3.6 stars out of 5

Bankrate Score

Rating of Availability: 4 stars out of 5

Affordability Rating: Four stars from five

The Customer Service Rating is 4.4 five stars of five

The Transparency Score: 2.5 stars out of 5

Check auto loan rates

The approximate Fifth Third Bank Loan amount between $2,000 and $80,000

Min. credit score 660

APR ranges from 6.41%-10.05%

The funds are available on the same day as the day of closing.

Fifth Third Bank pros and cons Before submitting a Fifth Third Bank auto loan application, you should consider whether the advantages of an in-person transaction is greater than the drawbacks.

PROS Autopay discount

Range of repayment options

In-person convenience

CONS Limited state availability

APR at a minimum of high

No prequalification

Fifth Third Bank, a regional bank with its headquarters in Cincinnati, offers for new and pre-owned vehicles as well as car refinance loans to its members that hold checking and savings accounts. This, together with its through partnered dealers make it a great option for drivers who prefer having the comfort of face-to-face communication. Financing is only available in the states Fifth Third serves: Florida, Georgia, Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, South Carolina and Tennessee. Indirect credit, on the other hand, is available across all states, with the exception of Alaska, Hawaii, Louisiana and Wyoming.

Do you qualify? The financing is only available to the states that Fifth Third serves: Florida, Georgia, Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, South Carolina and Tennessee. Indirect lending, on other hand, is available across all states, with the exception of Alaska, Hawaii, Louisiana and Wyoming. Fifth Third Bank does not define specific requirements other than being a resident of one of the states they serve and holding a for direct financing. What we like and what do not like Fifth Third Bank offers the accessibility of personal support, however it is only available to drivers in some states.

We like the Autopay discount. The borrower can take advantage of the benefit of a 0.25 percentage discount when they are linked to a Fifth Third Checking account. Range of repayment options. You can finance loans for between 12 and 75 months. In-person convenience. Fifth Third Bank operates at more than 1,100 branches across 10 states. We don't like the limited availability in states. Drivers in only 10 of the 50 states may apply for a Fifth Third auto loan. Minimum APR of 6.41. The minimum rate of 6.41 percent for dealer purchases and refinancing externally is greater than other lenders. There is no prequalification. It's impossible to get an idea of the rate you'll be charged until you submit a full application. How to contact Fifth Third Bank Customer support is open Monday through Friday from 8 a.m. to 6 p.m. ET and on Saturdays from 10 a.m. to 4 p.m. ET. In-person assistance at bank branches can assist you in the process of applying. Customers can also contact customer service at any time via the internet chat once you become a member.

Auto loan types available Fifth Third Bank offers new and used auto loans both directly and through dealerships, along with loan refinancing.

New and used auto loans

Loan quick facts Amounts: $2,000-$80,000 Terms: 12-75 months APR: 6.41%-10.05%

While Fifth Third Bank does not divulge much on its website about the new and used auto loans information, the information provided by a bank representative outlines the details. Loans can be financed for up to $80,000 and you can choose an interest rate between 12 and 75 months. Refinance

Loan quick facts Amounts: $2,000-$80,000 Terms: 12-75 months APR: 6.41%-10.05%

Refinancing the current loan with Fifth Third Bank can be an ideal option to lower your monthly payments and to alter your rate. The minimum APR for a loan is 6.41 percent. Receive the benefit of a .25 percent discount when refinancing a non-Fifth Third auto loan or making a commitment to have the payments automatically taken from a Fifth Third bank account. Indirect financing

Loan quick facts Amounts: $5,000-$100,000. The terms vary by dealer APR: 48-84 month.

Fifth Third Bank also offers through its network of new vehicle franchise dealers. These are available in all states , except Alaska, Hawaii, Louisiana and Wyoming. How do you apply for a loan with Fifth Third Bank To apply for a Fifth Third Bank auto loan, you can either visit a banking branch in your local area or contact 866-671-5353. Unfortunately, you cannot apply online. But you can manage your loan via your online account after approval. Before heading to a banking branch, use an to understand what you can manage. Although there isn't an cost for applying, be prepared for an initial fee of $165 if you accept the loan terms. After approval, make use of the option to pay by automatic to make sure you don't miss a payment, as there are additional late fees.

Required application information Valid form of identification is determined by the underwriter's findings during the review process

Fifth Third Bank FAQs

What interest rate should you anticipate when you take out your auto loan from Fifth Third Bank? Fifth Third Bank does not provide auto loan rates online or by phone. It is necessary to apply in writing to receive a loan quote that includes the cost of borrowing.

Do you need good credit to be eligible for the automobile loan through Fifth Third Bank? You could be eligible even in the absence of perfect credit, because Fifth Third Bank requires a minimum credit score of 660. Remember that the go to qualified borrowers, therefore it is beneficial to have a better credit score.

Can you get preapproved online in order to apply for an auto loan through Fifth Third Bank? Unfortunately, no. It is necessary to make an appointment to speak with a banker , or call 1-866-671-5353 to formally apply for a loan.

How Bankrate rate Fifth Third Bank

Overall score

3.6

Accessibility

4.0

The limited state availability is offset by multiple loan terms , as well as ample minimal and maximal loan amounts.

Affordability

3.4

A high minimum APR as well as unknown includes leave Fifth Third with a middling score.

Customer experience

4.4

Fifth Third allows automatic payments with online access, as well as customer support six days every day of the week.

Transparency

2.5

Fifth Third does not allow for loan prequalification, and rates and fees aren't disclosed on the internet.

Methodology Bankrate considers 18 data points when choosing the best auto loans. Acceptance criteria, rates and fees are readily available and the range of APR all affect lender scores. These scores are split into 4 categories. The availability of loans as well as repayment options, dealer requirements and state availability all play a role in this section. Accessibility: This section includes APR ranges, acceptance criteria, fees and discounts. Customer experience: The length of time you'll need to spend shopping, customer service availability, whether there's an app and autopay availability are covered within this category. Transparency: This category accounts for the availability of rates and fees along with whether or not prequalification is offered.

Editorial disclosure The reviews are written by Bankrate.com staff. The opinions expressed in the review are only those of the reviewer and have not been reviewed nor acknowledged by any advertising company. The information that is included, including rates and fees provided in the review is correct up to the date when the review first appeared. Review the information in the upper right hand corner of the page and the lender's website for the most recent details.

Written by

Rebecca Betterton

Auto Loans Reporter

Rebecca Betterton is the auto loans reporter for Bankrate. She has a specialization in helping readers with the ins and outs of securely taking out loans to purchase an automobile.

The edit was done by Rhys Subitch Edited by Auto loans editor

Rhys has been editing and writing for Bankrate since late 2021. They are committed to helping readers gain the confidence to take control of their finances by providing clear, well-researched information that breaks down complex topics into manageable bites.

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Are you denied the auto loan? Here's everything you need to know Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our goal is to help you make better financial decisions by providing you with interactive financial calculators and tools as well as publishing original and impartial content. This allows users to conduct research and compare data for no cost and help you make informed financial decisions. Bankrate has agreements with issuers, including but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make money The products that appear on this site are from companies that compensate us. This compensation may impact how and where products are displayed on the site, such as such things as the order in which they may appear in the listing categories in the event that they are not permitted by law. This applies to our mortgage, home equity and other home loan products. But this compensation does affect the information we publish, or the reviews that appear on this website. We do not include the universe of companies or financial deals that could be open to you. yourstockbank/Getty Images

4 min read Published on October 12, 2022.

Kellye Guinan Kellye Guinan. Written by Personal and Business Finance writer Kellye Guinan is an editor and writer freelance with more than five years of experience in personal finance. She also is employed full-time at the local library where she assists the community to access information about financial literacy, as well as other subjects. Edited by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate from late 2021. They are passionate about helping readers feel confident to control their finances through providing clear, well-researched information that breaks down complex subjects into bite-sized pieces. The Bankrate guarantee

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who ensure everything we publish will ensure that our content is reliable, honest and reliable. Our loans reporter and editor focus on the things that consumers care about most -- the various types of loans available as well as the best rates, the top lenders, ways to pay off debt and much more. So you can feel confident when making your decision to invest your money. Integrity of the editing

Bankrate has a strict policy standard of conduct, which means you can be confident that we put your interests first. Our award-winning editors, reporters and editors produce honest and reliable content to aid you in making the best financial decisions. The key principles We respect your confidence. Our goal is to provide readers with truthful and impartial information, and we have established editorial standards to ensure this happens. Our editors and reporters thoroughly check the accuracy of editorial content to ensure that what you read is correct. We have a strict separation between advertisers as well as our editorial staff. Our editorial team doesn't receive direct compensation through our sponsors. Editorial Independence Bankrate's editorial team writes on behalf of YOU - the reader. Our goal is to give you the most accurate advice to aid you in making informed personal finance decisions. We follow strict guidelines for ensuring that editorial content isn't in any way influenced by advertising. Our editorial team is not paid direct compensation from advertisers, and all content is checked for accuracy to ensure its truthfulness. So when you read an article or a report it is safe to know that you're receiving reliable and dependable information. What we do to earn money

There are money-related questions. Bankrate has the answers. Our experts have helped you understand your finances for more than four years. We continually strive to give our customers the right advice and tools needed to be successful throughout their financial journey. Bankrate adheres to strict standards , so you can trust that our information is trustworthy and accurate. Our award-winning editors and reporters provide honest and trustworthy information to assist you in making the best financial decisions. The content we create by our editorial team is factual, objective and is not influenced through our sponsors. We're open about how we are able to bring quality information, competitive rates and useful tools to you , by describing how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our website. Therefore, this compensation may impact how, where and in what order items appear within listing categories and categories, unless it is prohibited by law. This is the case for our loan products, such as mortgages and home equity, and other home loan products. Other factors, such as our own website rules and whether a product is offered in your region or within your own personal credit score can also impact the way and place products are listed on this site. While we strive to provide the most diverse selection of products, Bankrate does not include specific information on every financial or credit product or service. A car loan application may be rejected due to your credit score or your current financial status. But by reaching out to your lender and reorganizing your finances, you can work on making an application that won't be rejected in the near future. Why was I denied an auto loan? The majority of lenders reject applicants due to credit scores or credit history, as well as overall debt. There are mistakes in the application. You can be denied a loan because of simple mistakes in the application. If you miss a section or record information incorrectly, lenders may reject you without giving you the chance to amend inaccurate data. Make sure you review every aspect of your application to ensure you have all the information you need. It is possible to apply for a second time with the same information, but being accurate when you first apply will help you save time. Low credit score Many lenders have a minimum credit score as part of their criteria for eligibility. In the general case, they need that you have fair credit -- scores of 620 or greater. If you have a credit score lower than this requirement then you'll be immediately denied. There are . But these will cost more over the long term and may have more fees -- like the origination fee or prepayment penalty that are higher than traditional auto loans. A poor credit history If you have limited or no credit history, lenders will not be able to determine your capacity to pay subsequent auto loan payments. They could use this as a reason to reject your application. However, it's going to take time to amend this. You'll need to take on other smaller debts in order to build credit before you apply again, or with a co-signer. Large amount of debt If you're in the middle of debt gathered from other loans and credit card, your DTI ratio -- also known as ratio of debt to income will be greater. A DTI proportion of 50%% or higher is considered to be a warning sign and could lead to rejection. The process of paying down debts is the most effective way to lower your DTI, but if you're able, a second source of income can reduce your DTI. What to do if you were refused an auto loan The rejection doesn't mean an end in itself. Do a few things before applying for a loan again to increase your chances of being approved. Get in touch with your lender Lenders are required to provide you with the exact reasons your application was not approved. If it isn't automatically sent, request to receive it in the 60-day period following your application. Otherwise, it will fall outside of The Equal Credit Opportunity Act. If it was something as simple as an application error you are able to make changes and apply again. If the issue was due to you're credit score, or any other debts, you could work on improving them prior to applying again. Improve your credit score. Your credit score is among the most important factors that lenders look at when they consider granting you a loan. Take the time to by reviewing your credit report, paying your bills on time and lowering your ratio for credit utilization. This will take a few months. If you're trying to get a loan in a hurry think about other options while you work on your score. Once you've established a solid recent repayment history and have a good credit score, lenders will view you as less risky. Be mindful of your debt. Keeping it low and reducing your debt is a crucial factor in being able to attract prospective lenders. You should focus on paying down your debts currently and making sure to avoid new loans and credit card purchases. Check your budget and attempt to eliminate any unnecessary expenditures before applying again. is also an excellent method to reduce your debt-to-income ratio (DTI) which is the ratio that lenders use to determine if you're able to comfortably afford a new loan to pay. Search for lenders with low credit scores. There are lenders that accept . This may be a means to get you behind the wheel sooner instead of later. The lenders target drivers with low credit scores. However, you must be aware of the options as auto loans for those with bad credit tend to have significantly higher interest rates, which could cost you thousands in the long term. Alternative options The choices you have hinge on how you can swiftly improve your credit and lower the amount of debt you have -- although they can both be beneficial. "Buy here, pay here" dealers A BHPH dealership isn't the perfect choice, but it can be a viable option if you have a low credit score and are in desperate need of an automobile. BHPH dealerships finance and sell the cars on their lot. Credit approval standards are generally lower while the approval process can be faster than traditional lending. But the interest rates are high, and there are less cars available. Auto loans that are joint loans The term "joint auto" loan is the case when you and a third party usually a partner or spouse -- share the same responsibility for the car loan. The lender will take into consideration both income and credit scores when making an approval decision. A joint application can also lead to a lower interest rate and the ability to take on an additional loan because of the added income. A co-signed car loan An auto loan will mean that you still take on the entire responsibility for the monthly installments, but with an additional person supporting the loan. Like with a joint auto loan, both your credit history and your co-signer's credit score will be considered when applying for the loan. This increases your chance of approval, which could translate into more and terms. The main thing to remember is that if you've been rejected, take the time to think about it. Your lender must provide you with a letter explaining the reason you were denied. Like everything else in the realm of finance, preparation is crucial. Next time you apply, do your research and keep an eye on your credit score and lower your total debt ahead of time. This will help ensure your application is as good as it can be when you present it to the lender. Find out more

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Written by Business and personal finance writer Kellye Guinan is a freelance editor and writer who has more than 5 years experience working in the field of personal financial. She is also an employee full-time at her local library where she helps people in her community get information about financial literacy, in addition to other topics. Written by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since the end of 2021. They are passionate about helping readers gain confidence to take control of their finances by providing clear, well-researched facts that break down complex topics into manageable bites.

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Other Articles Related to Related Articles Loans six minutes read Mar 02, 2023 Auto Loans 4 min read November 16, 2022. Auto Loans Read 4 minutes Oct 21 2022 Auto Loans Read 6 minutes Sep 30 2022

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Do you want to purchase a new or used car? Part Of Buying a Car In this series Buying a Car Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our mission is to help you make better financial choices by offering interactive tools and financial calculators as well as publishing original and impartial content. We also allow users to conduct research and compare data for no cost to help you make informed financial decisions. Bankrate has agreements with issuers such as, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make Money The offers that appear on this site are from companies who pay us. This compensation may impact how and where products are displayed on the site, such as for instance, the sequence in which they be listed within the categories of listing in the event that they are not permitted by law. Our mortgage, home equity and other home loan products. But this compensation does not influence the information we provide, or the reviews that you read on this site. We do not include the vast array of companies or financial offerings that could be accessible to you. Peter Cade/Getty Images

6 min read . Published on December 1, 2022.

Writer: Rebecca Betterton Written by Auto Loans Reporter Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers with the details of borrowing money to buy cars. Edited by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate from late 2021. They are committed to helping readers to take control of their finances with clear, well-researched facts that break down complicated topics into bite-sized pieces. The Bankrate promises

More info

At Bankrate we strive to help you make better financial choices. We are committed to maintaining strict editorial integrity ,

This article may include references to products from our partners. Here's an explanation for how we earn money . The Bankrate promise

In 1976, Bankrate was founded. Bankrate has a proven track experience of helping customers make smart financial choices.

We've kept this reputation for over 40 years by simplifying the process of financial decision-making

process and giving people confidence about the actions they should do next. process and gives people confidence in the next step.

You can rest assured that we'll put your interests first. Our content is authored with and edited ,

who ensure everything we publish will ensure that our content is reliable, honest and reliable. Our loans reporters and editors are focused on the areas that consumers are concerned about the most -- the various types of loans available and the most competitive rates, the best lenders, ways to repay debt, and many more -- so you'll be able to feel secure when investing your money. Integrity of the editing

Bankrate follows a strict standard of conduct, which means you can be confident that we put your interests first. Our award-winning editors, reporters and editors create honest and accurate content that will help you make the right financial decisions. Key Principles We respect your confidence. Our goal is to offer readers accurate and unbiased information. We have standards for editorial content in place to ensure this is the case. Our editors and reporters thoroughly verify the truthfulness of content in order to make sure the information you're receiving is true. We keep a barrier with our advertising partners and the editorial team. Our editorial team does not receive direct compensation from our advertisers. Editorial Independence Bankrate's editorial team writes on behalf of YOU - the reader. Our aim is to offer you the best guidance to make smart personal finance decisions. We follow strict guidelines to ensure that our editorial content isn't affected by advertisements. Our editorial staff receives no any compensation directly from advertisers and our content is thoroughly checked for accuracy to ensure its truthfulness. So, whether you're reading an article or a review, you can trust that you're getting credible and reliable information. How we make money

If you have questions about money. Bankrate can help. Our experts have helped you understand your money for more than four years. We strive to continuously provide consumers with the expert guidance and the tools necessary to succeed throughout life's financial journey. Bankrate adheres to a strict code of conduct , so you can trust that our content is truthful and accurate. Our award-winning editors, reporters and editors create honest and accurate information to assist you in making the right financial choices. The content created by our editorial team is accurate, truthful and uninfluenced by our advertisers. We're transparent regarding how we're able to bring quality content, competitive rates, and helpful tools to you by explaining how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated for placement of sponsored products andservices or by you clicking on specific links that are posted on our site. Therefore, this compensation may impact how, where and in what order items appear within listing categories, except where prohibited by law. We also offer mortgage or home equity products, as well as other products for home loans. Other factors, like our own rules for our website and whether the product is available in the area you reside in or is within your own personal credit score may also influence the manner in which products appear on this website. Although we try to provide a wide range offers, Bankrate does not include the details of each financial or credit item or service. It's the decision millions of car buyers make every year: Should you purchase a brand-new car or choose to purchase an older vehicle to save money? Deciding between that new car smell or an older model comes down to more than price- but it's an important factor. New cars cost $716 per month, while the used vehicles average $526, according to Experian's data for the fourth quarter of 2022. If you're trying to save money on your initial purchase, a used car is a great option. But , you'll have to think about the cost over the life of ownership, which includes the maintenance as well as repairs. You may find that buying new is the best option for your budget. The most important thing to remember

New is often the best option if want the latest features and cheaper initial maintenance costs. Buying used might fit better if you are willing to compromise on some features to save on the initial purchase and insurance.

Compare the costs of new or. used cars There are a variety of options to check out your purchase, whether new or used. There are new cars available at local dealerships or search on websites such as or Edmunds. Used cars can be found through dealerships, but they are also available -- potentially cheaper -through independent dealers, private-party sellers or superstores such as . In general used vehicles are more affordable than new cars. However, both have risen dramatically in price over the last few years. New car payments have jumped from a monthly average of $554 in the year 2019 to $667 in 2022. That's which is an 18.5 percentage difference. Also, used cars experienced a drastic jump from $391 to $515 and an increase of 27.4% difference. For the best way to prepare for the costs of owning a vehicle -whether it's new or used- and can give you an idea of costs for purchase and maintenance costs over five years. Here's the breakdown of prices of Edmunds for a brand-new Honda Accord versus a used one. New 2022 Honda Accord EX-L

Used for 2017 Honda Accord EX-L

Price of the typical listing

$35,338

$22,895

Estimated monthly payment

$668

$449

Estimated cost of the first year of ownership maintenance costs

$140

1 371 monthly installments are built on the average interest rates for both new and used cars as of Q1 2022 and a 60 month term. Maintenance and repair expenses for during the initial year are according to Edmunds. Price shouldn't be the only thing you consider when selecting a car. You must also consider factors like depreciation security features, reliability, and your personal preferences. Considerations when buying a new car. Buying a brand new vehicle is a less-maintenance investment in the newest technology. Benefits of purchasing a new car comes with a variety of options -- many of which you get to pick when you find the right dealer. Customization: The main benefit of purchasing a brand new car is that you can get it customized to suit your needs and preferences. You can choose the color and style you prefer and ask for any extras that appeal to you. Modern technology is a practical benefit too -- you will drive off with the latest technology with safety and security features. More favorable interest rates: When you make an investment in a brand-new car, you are more likely to secure an interest rate that is better on an auto loan than you would with buying a used car typically by a couple of percentage points. Reliability: You won't have to worry about any issues with your mechanical system when purchasing a brand new. Plus, the should limit your spending on repairs and maintenance during the first few months of owning. Pros of buying new, buying new is more expensive and has some downsides that can dent your budget. More expensive The newer cars are usually several thousands of dollars higher than predecessors that are used, which can make a down payment or monthly loan payment more expensive to pay for. Depreciation: There's also the issue of to deal with the rate at which your car loses value. As the saying goes, new cars lose value as soon as you take them off the lot. New vehicles will lose 20 percent of their value during the first year, and depreciation is continued for up to 10 years after the initial purchase. Higher insurance costs: New cars often cost more to insure due to the higher risk of theft, greater price and other aspects. If you do choose that it is the best option for you, you should plan and look out for . Making the right decision about when to buy your car and could help reduce initial costs. When buying used, you should consider the following considerations. vehicles typically have a lower price tag and are more depreciating, but have other shortcomings to look out for. Advantages of buying used a used car, you could save money on the monthly payments, insurance, and other charges. Additionally, depreciation is likely to occur at a slower pace. Have a look at these benefits below: Less expensive The primary benefit is that they're generally less expensive than their new counterparts. If you find the exact model you're interested in a couple of years old can save you some thousand dollars. Costs and insurance fees are lower: Many pre-owned cars carry less titling, registration and sales taxes. You could save money both on the purchase and over the course of the car's lifespan. Depreciation is slower: used cars also depreciate much slower. Rather than losing 20 percent of its value in the initial year after purchase an older car of three years would just lose 10. A negative experience with buying used might necessitate you to alter your priorities when you are ready to purchase your next car, research the car's history and put aside money to maintain the vehicle. Making compromises: You will have to research to find the design, color and style you want. Even then you could need to compromise. The market for cars is highly competitive at the moment and you may not be able to tick all the checkbox. The car's history: You'll also need to check the vehicle's maintenance record to make sure that the previous owner took good care of the vehicle. It is recommended to take the vehicle to a trusted mechanic for a thorough check-upwhich includes a brake inspection and engine check prior to closing any deal. It is possible to shell out around $100 for the work of the mechanic, but it is well worth it. Increased maintenance costs even if your car is in good shape the used vehicle will eventually require maintenance and repairs over time. This could eat into the savings you get from your initial purchase, so consider your long-term budget when deciding between new or used. If you're trying to reduce the cost of your first purchase, a used vehicle is a great option. However, you must take into account the cost throughout the duration of ownership -- including repairs and maintenance. Pre-owned certified options If you're considering purchasing used, but aren't sure about relying on the history of the vehicle then a certified pre-owned vehicle is an excellent choice. A certified used car is one that has been subjected to a thorough inspection by either the dealer or manufacturer. These cars are an equalizer between new and used vehicles in terms of upfront price because you'll have to pay for the inspection. This additional certification is perfect for those who need security from a car that is in good condition, but without the price tag of a brand new vehicle. How to choose whether to buy a new or used vehicle The decision between buying a brand new or used vehicle will come down to a variety of factors, including the financial aspect and your preferences and requirements. Take into consideration these factors when deciding which type of purchase is best for you. Budget multiple costs are usually cheaper when you buy a used vehicle rather than buying a brand new one. Everything from the to dealer costs is less expensive when you purchase a second-hand vehicle. The vehicle you choose, the purchase price will also typically be less for a used car. When you calculate the numbers to determine much car you can afford take a look beyond the monthly payments and insurance. Include annual registration costs, fuel expenses maintenance and repairs. The bells and whistles one advantage of buying a new car is that it'll come with the most recent technology in safety and technology. Additionally, if being able to select a specific car color or interior finish is essential to you, a new car purchase can simplify this. If you are buying a used vehicle it is possible to spend a long time trying to find the exact car you want. However, the pleasure of choosing the right package for tires, sound system or seating may not outweigh the cost-savings of skipping these add-ons and buying second-hand. If you are concerned regarding the security of the vehicle you're considering using the tools on the site to verify its safety ratings. Maintenance needs A slightly older could have higher maintenance costs, which is an important consideration if you're living on a small household budget. Much of the maintenance associated with a new car will likely be under warranty. But if you're leaning toward an older car that is no longer covered under warranty, it's not necessarily a deal breaker. You may be able to obtain the extra protection you require. The typical extended warranty is approximately $1,480. However, you could spend far more or less, depending on your vehicle and the amount of protection you choose. How do you find the most affordable price on your vehicle, whether you choose to purchase a brand new or used, you must remember that researching the vehicle is the most important factor in . Research should include checking the car's safety history, insurance costs and the cost-to-own for five years. Try to help make the right choice. Also, consider a test drive of several vehicles and compare prices with a couple of sellers and get quotes from a variety of . Ensure that you get the lowest monthly payments and the most competitive financing terms to ensure that you keep more of your hard-earned dollars in your pocket. The final decision between new and used cars comes down to many factors, including the concerns you have regarding depreciation, budget, your determination to have certain features and how long you plan on having your vehicle. Once you have a car in mind, shop around and before you head to the dealer for the best price. Learn more

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The article was written by Auto Loans Reporter Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers in navigating the details of borrowing money to purchase cars. The article was edited by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since late 2021. They are passionate about helping readers gain the confidence to control their finances through providing concise, well-studied details that cut complicated topics into digestible pieces.

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How to spot auto loan fraud Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our goal is to help you make better financial decisions by offering you interactive financial calculators and tools as well as publishing original and objective content. We also allow you to conduct your own research and analyze information for free - so that you can make financial decisions without a doubt. Bankrate has partnerships with issuers, including but not restricted to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make Money The deals that are advertised on this website are provided by companies that pay us. This compensation may impact how and where products appear on the site, such as, for example, the order in which they may be listed within the categories of listing, except where prohibited by law. This applies to our mortgage, home equity and other home loan products. But this compensation does affect the content we publish or the reviews you see on this site. We do not include the universe of companies or financial offers that may be available to you.

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4 min read Published 28 February 2023

Authored by TJ Porter. Written by Contributing writer

TJ Porter works as a contributor writer for Bankrate with eight years of experience in writing about finance. TJ writes on a variety of subjects, including .

Edited by Rhys Subitch Edited by Auto loans editor

Rhys has been writing and editing for Bankrate from late 2021. They are passionate about helping readers gain the confidence to manage their finances through providing concise, well-researched and well-organized data that has broken down complicated topics into bite-sized pieces.

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At Bankrate we aim to help you make better financial decisions. While we adhere to strict editorial integrity ,

This post could contain some references to products offered by our partners. Here's an explanation for how we earn money .

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In 1976, Bankrate was founded. Bankrate has a long record of helping people make smart financial choices.

We've earned this name for over four decades by demystifying the financial decision-making

process and giving customers confidence about the actions they should do next. process and gives people confidence in the next step.

You can rest assured you can trust us to put your needs first. All of our content is created in the hands of and edited by

They ensure that what we write is objective, accurate and reliable. Our loans reporters and editors focus on the things that consumers care about most -- the different types of lending options as well as the best rates, the most reliable lenders, the best ways to repay debt, and many more, so you're able to be confident about investing your money.

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Bankrate has a strict policy standard of conduct, which means you can be confident that we're putting your interests first. Our award-winning editors and journalists produce honest and reliable content that will aid you in making the best financial decisions. The key principles We value your trust. Our mission is to offer readers accurate and unbiased information. We have editorial standards in place to ensure that this happens. Our reporters and editors rigorously verify the truthfulness of content in order to make sure that the information you're reading is true. We have a strict separation between advertisers as well as our editorial staff. The editorial team of Editorial Independence Bankrate does not receive direct compensation through our sponsors. Editorial Independence Bankrate's editorial team writes on behalf of YOU as the reader. Our goal is to give you the best advice to aid you in making informed personal financial decisions. We adhere to strict guidelines in order in order to make sure that the content we publish isn't affected by advertisements. Our editorial team receives no any compensation directly from advertisers and our content is verified to guarantee its accuracy. Therefore, whether you're looking at an article or review, you can trust that you're getting reliable and reliable information.

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You have money questions. Bankrate has answers. Our experts have been helping you master your finances for more than four years. We continually strive to give our customers the right advice and tools needed to succeed throughout life's financial journey. Bankrate adheres to a strict code of conduct , so you can trust that our content is honest and precise. Our award-winning editors, reporters and editors create honest and accurate information to assist you in making the right financial decisions. The content we create by our editorial staff is objective, factual, and not influenced by our advertisers. We're transparent about the ways we're capable of bringing high-quality content, competitive rates and useful tools for you by explaining how we earn our money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for the promotion of sponsored goods or services, or through you clicking specific links on our site. So, this compensation can influence the manner, place and in what order items appear within listing categories and categories, unless it is prohibited by law. We also offer mortgage, home equity and other home lending products. Other factors, like our own proprietary website rules and whether or not a product is available in your area or at your own personal credit score could also affect the manner in which products are featured on this website. We strive to offer the most diverse selection of products, Bankrate does not include specific information on every financial or credit product or service.

When scammers targeted homeowners in the housing downturn however, auto loan frauds are now starting to grab the attention of government watchdogs. These scams range from shady financing tricks that force consumers into unfavorable financial agreements to deceptive negative equity deals that leave consumers in debt for more auto loan debt than they anticipated. Often scammers target car owners who must catch up on their payments and want to avoid getting their cars taken away. These scams can be expensive and you should be aware of the warning dangers to look out for. The scam of car loan modification scams A car loan modification scam is a scam that is designed to steal your money without offering any service. The car loan modification scammers claim to reduce your auto loan payment. In exchange for helping you achieve the goal they demand an unfathomably high fee in advance. Scammers usually demand fees upfront or unusual forms of payment. They may also pressure you to sign an agreement, and they will usually not even check the credit rating of your. The scammers may instruct you to not make auto loan payments as they "negotiate" with your lender. It's also not unusual for scammers and scammers to demand additional money as they continue their so-called efforts on your case. In certain cases the scam firm might ask you to make payments on your car directly to them instead of your lender. "The scams are like mortgage loan modifications scams and the scammers claiming that they can prevent their car from being taken away and that they can lower their monthly payments," says Gregory Ashe Senior Staff Attorney with the Bureau of Consumer Protection at the Federal Trade Commission. Possession is possible after one or two months non-payment. The longer you wait to call, the fewer options you have. "Auto lenders are not typically offering lower interest rates or decreasing the principal balance of a car," Ashe says. "If you do have any relief that can be obtained, it's generally to extend the length of the loan to reduce your monthly payments , or to postpone payments due to late payments until the end of the loan. There will be a higher cost over the life of the loan, so there's no significant savingshowever at least you'll have the chance to pay for your car payment." How to avoid

To avoid being the victim of a car loan modification scam, the FTC recommends as soon as you realize you are susceptible to being a victim. Also, avoid false promises of lower payment on your car from companies that are not trustworthy.

Yo-yo financing scams A advertises a low interest rate in front of buyers, and then pulls it off to make an already committed buyer agree to lower conditions. This is how it operates. A dealer will lead the buyer to believe the financing is complete that they will take a trade-in as a down payment and allows the buyer to leave the dealership with a brand new vehicle. Some days and even weeks after, the dealer will contact the customer and inform them that the financing fell through. The buyer will have to come back to sign a new contract, typically with less favorable terms. Sometimes the dealership has already sold the trade-in vehicle, leaving the buyer to select between higher rates or no car at all. These scams typically target customers with fewer financing options because they do not have . Yo-yo financing is prohibited in all states, according to Paul D. Metrey, senior vice president for regulatory affairs for the National Automobile Dealers Association in McLean, Virginia. However, there are spots and sales with conditional terms that are completely legal. In fact, the FTC is currently drafting a for car dealers that includes the language needed to safeguard consumers from the yo-yo finance traps. If it is enacted, the rule will prevent dealers from making false representations the fact that the transaction has been completed. What can you do to prevent

To stay clear of a yo-yo fraud Buyers can go to the dealership with their credit card secured before the scheduled time. It is likely that you will get an interest rate that is better through the credit union or bank that your account is already open. Also, bringing in the money already secured gives you .

Negative equity scams The FTC has taken administrative action for Truth in Lending Act violations regarding how those dealers handled negative equity. The dealers did not clearly inform consumers that although they claimed for "pay for" the balance due to a trade-in, they actually took the negative equity and applied it to the borrower's new car loan balance. Many clients complained that they didn't be aware of this until they had signed their new auto financing documents. "Consumers must read the paperwork before signing it because it doesn't matter what's written. It's all about the writing," Ashe says. "If you don't understand something, then don't sign it." How can you avoid

After reviewing you loan documents, make sure to confirm that the loan amount is what you were obligated to pay. If there are additional costs you aren't sure about, ask the finance department at the dealership to explain these to you. Your trade-in should be treated as a distinct transaction. While you can choose to into the new loan, the dealer needs to be clear about what the implications of this will be for the loan.

The loan packing dealer may make you feel pressured to and services when you buy an automobile. These might include extended warranties , rustproofing, tire rotation and service agreements. Although some of these products may be beneficial, the majority aren't. The dealer's primary goal in this instance is convince you to spend more money. However, you're under no obligation to agree to any extras. If some options appeal to you, you can try to negotiate the price for the extra item just as you would discuss the price of the car itself. Be aware that when you add it to the loan, you're paying the interest. How can you avoid it?

Find out what's available and then see what you can do yourself or get done at a shop elsewhere. You may find that you can find the products or services at a lower price and superior quality without having to wrap them in your loan.

The main point is that loan modification frauds target those who have poor credit or who are in arrears with their payments. If it seems too appealing to be true it's probably true. If you're having trouble paying your loan, the best option is talk to the lender directly. The majority of lenders are willing to work with you when you demonstrate that you're making an honest effort to continue making payments.

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Written by Contributing writer

TJ Porter works as a contributing writer at Bankrate with over eight years of experience writing about finance. TJ writes on a variety of subjects, including .

Editor: Rhys Subitch Edited by Auto loans editor

Rhys has been writing and editing for Bankrate from late 2021. They are passionate about helping readers feel confident to control their finances through providing clear, well-researched data that breaks otherwise complicated topics into bite-sized pieces.

Auto loans editor

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How car rebates work Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by offering interactive tools and financial calculators, publishing original and objective content. We also allow users to conduct research and compare information for free - so that you can make financial decisions with confidence. Bankrate has agreements with issuers including, but not limited to American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make money The products that are advertised on this site come from companies that compensate us. This compensation could affect how and where products appear on this website, for example, for example, the sequence in which they appear in the listing categories and other categories, unless prohibited by law. This applies to our mortgage, home equity, and other home lending products. But this compensation does affect the content we publish or the reviews appear on this website. We do not contain the vast array of companies or financial offers that may be accessible to you. Don Mason/Getty Images

3 minutes read. Published October 21, 2022

Written by Rebecca Betterton Written by Auto Loans Reporter Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers in navigating the ways and pitfalls of borrowing money to purchase cars. Edited by Chelsea Wing Edited by Student loans editor Chelsea is with Bankrate since the beginning of 2020. She's dedicated to helping students to navigate the steep cost of college as well as simplifying the complex world that are associated with student loans. The Bankrate promises

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This article may include the mention of products made by our partners. Here's how we earn money . The Bankrate promise

Established in 1976, Bankrate has a proven track history of helping people make informed financial decisions.

We've maintained this reputation for over four decades by simplifying the process of financial decision-making

process, and giving people confidence in the decisions they will take next. Bankrate follows a strict ,

so you can trust you can trust us to put your needs first. All of our content was authored in the hands of and edited by

They ensure that what we write will ensure that our content is reliable, honest and reliable. Our loans reporters and editors focus on the points consumers care about most -- the different kinds of loans available, the best rates, the best lenders, ways to pay off debt , and more -- so you're able to be confident about investing your money. Integrity of the editing

Bankrate has a strict policy , so you can trust that we put your interests first. Our award-winning editors and reporters produce honest and reliable content that will aid you in making the best financial decisions. The key principles We appreciate your trust. Our mission is to provide our readers with truthful and impartial information, and we have editorial standards in place to ensure this happens. Our reporters and editors thoroughly fact-check editorial content to ensure the information you're reading is correct. We have a strict separation between our advertisers and our editorial team. Our editorial team doesn't receive compensation directly by our advertising partners. Editorial Independence Bankrate's team of editors writes for YOU the reader. Our goal is to provide you the most accurate guidance to make wise financial choices for yourself. We follow strict guidelines for ensuring that editorial content isn't affected by advertisements. Our editorial team is not paid any compensation directly from advertisers and our content is fact-checked to ensure accuracy. So whether you're reading an article or a report, you can trust that you're getting reliable and dependable information. What we do to earn money

You have money questions. Bankrate has answers. Our experts have been helping you manage your money for over four decades. We strive to continuously give consumers the professional guidance and the tools necessary to be successful throughout their financial journey. Bankrate follows a strict standard of conduct, so you can rest assured that our content is honest and accurate. Our award-winning editors and reporters provide honest and trustworthy content to help you make the right financial decisions. Our content produced by our editorial staff is factual, objective, and not influenced from our advertising. We're open about the ways we're able to bring quality information, competitive rates and useful tools for you by explaining how we make money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for the promotion of sponsored goods and services, or through you clicking specific links on our site. So, this compensation can affect the way, location and when products appear in listing categories, except where prohibited by law. This is the case for our mortgage, home equity and other products for home loans. Other factors, such as our own website rules and whether or not a product is available within the area you reside in or is within your personal credit score can also impact the way and place products are listed on this website. Although we try to offer the most diverse selection of products, Bankrate does not include details about every financial or credit service or product. When it is time to explore financing for an automobile, you will have several choices for details about promotional finance, including rebates. Rebates allow you to get money back when you purchase a car, and can reduce your total loan amount. However, manufacturers and dealers have different ways of structuring their incentives. When you are buying a new car, be sure the rebate will actually save you money. What is a rebate for an automobile? An auto loan rebate is a reward that grants you cash back in exchange for purchasing the vehicle. This serves as motivation for you to purchase the vehicle in the specific scenario that the dealership controls. Since rebates are offered by manufacturers, you'll have to visit a dealership that works directly with the manufacturer to get the rebate. You may also need to select a particular model, typically one of the higher-end options, in order to receive a rebate. How auto rebates work Rebates are special deals that provide buyers with some thousands of dollars off the cost of the vehicle. The rebates won't affect your purchase price -- you are able to negotiate with the dealer before considering rebates. However, it will lower the amount you spend on a car. Rebates usually last for several months and you'll need meet certain requirements in order to qualify -- for instance, you may have to choose a specific type of car or apply for . Is an auto rebate an excellent idea? The auto loan rebates are something to look into if they are available. Rebates are used to reduce you down payments, your closing costs, or even your overall loan amount. In some cases the amount you pay could be reduced by as much as a thousands of dollars. However, you shouldn't purchase a vehicle simply because of a rebate. In most cases the range of vehicles available for a rebate is limited and rebates tend to be restricted to new cars -- and often, the higher-cost versions of these new cars. The lure of a rebate could tempt you to spend more on the wrong car for your needs or your budget. How do you get an auto-rebate? Unlike zero percent financing, rebates on cars don't have any set guidelines. If you choose a car model and trim with a rebate, you qualify. Search manufacturer deals on new cars Rebates are usually advertised along with lease deals and other special interest rates. Auto rebates can be sent directly to you, however it could also be part of your down amount. This means you need to finance less overall, which can save you money upfront and over the life of your car loan. In certain states, you might be able to have rebates applied to purchase price prior to taxes are added, however you'll need to verify the rules of your state in order to request the rebate. Auto rebate is different from. low-interest financing Rebates and deals like a 0 percent APR deal, save you money differently. Rebates offer you a flat amount of money that is normally put towards an initial down payment, or closing expenses. Low-interest financing is another option that, in turn, cuts down on the ongoing interest charges and may lower your monthly installment. An auto rebate is likely to make the most savings on your car overall. While you'll be charged interest on your loan however, it's interest on a much lower amount. A zero percent APR deal can save you money over time, however the most important benefit is lower monthly payment. People with good credit may be able to get the best of both worlds -receiving an incentive from the dealer and obtaining a lower interest rate from an . The most important aspect to determine if the rebate you receive is a good financial choice comes down to how much it will save you. Find rebates on car models that you were already thinking about and be aware of how that rebate will be used. It is possible to use a financing calculator to determine the amount you can save by using different financing options. Find out more

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This article is written by Auto Loans Reporter Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in helping readers to navigate the details of borrowing money to purchase an automobile. Written by Chelsea Wing Edited by student loans editor Chelsea is with Bankrate since the beginning of 2020. She's committed to helping students manage the steep costs of college and dissecting the complexity that are associated with student loans.

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Related Articles Banking 4 minutes read Nov 21, 2022. Loans 4 min read Aug 22, 2022. Auto Loans four minutes read Jun 17, 2022 Auto May 16, 2013,

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Pros and cons of leasing as compared to. purchasing a car. Part of Buying a Car In this series buying a Car

Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive financial calculators and tools as well as publishing objective and original content. This allows you to conduct research and to compare data for no cost to help you make sound financial decisions. Bankrate has agreements with issuers, including but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Make Money The offers that appear on this website come from companies that compensate us. This compensation may impact how and when products are featured on this site, including, for example, the sequence in which they appear within the listing categories in the event that they are not permitted by law for our loan products, such as mortgages and home equity and other products for home loans. However, this compensation will not influence the information we publish, or the reviews that you see on this site. We do not cover the vast array of companies or financial deals that could be open to you.

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5 min read published March 03, 2023.

Written by Rebecca Betterton Written by Auto Loans Reporter

Rebecca Betterton is the auto loans reporter for Bankrate. She has a specialization in helping readers with the ways and pitfalls of borrowing money to purchase the car they want.

Editor: Rhys Subitch Edited by Auto loans editor

Rhys has been editing and writing for Bankrate since the end of 2021. They are committed to helping readers gain confidence to take control of their finances through providing clear, well-researched information that breaks down complicated subjects into digestible pieces.

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At Bankrate we strive to help you make better financial choices. We are committed to maintaining strict editorial integrity ,

this post may contain the mention of products made by our partners. Here's an explanation for how we make money .

The Bankrate promise

In 1976, Bankrate was founded. Bankrate has a long track record of helping people make wise financial choices.

We've maintained this reputation for more than 40 years by demystifying the financial decision-making

process and giving people confidence in the decisions they will do next. Bankrate follows a strict ,

So you can be sure that we'll put your interests first. Our content is written by and edited by

They ensure that what we write is objective, accurate and trustworthy. Our loans reporters and editors focus on the things that consumers are most concerned about the most -- the different types of lending options as well as the best rates, the best lenders, ways to repay debt, and more -- so you can feel confident when investing your money.

Editorial integrity

Bankrate follows a strict , so you can trust that we're putting your interests first. Our award-winning editors and reporters provide honest and trustworthy content to assist you in making the right financial choices. Our main principles are that we value your trust. Our goal is to offer readers accurate and unbiased information, and we have established editorial standards to ensure this happens. Our editors and reporters thoroughly verify the truthfulness of content in order to make sure that what you read is accurate. We have a strict separation between our advertisers and our editorial team. Our editorial team doesn't receive direct compensation by our advertising partners. Editorial Independence Bankrate's team of editors writes for YOU - the reader. Our goal is to give you the most accurate advice to help you make smart personal financial decisions. We follow strict guidelines for ensuring that editorial content is not affected by advertisements. Our editorial team is not paid direct compensation from advertisers, and our content is thoroughly checked for accuracy to ensure its truthfulness. If you're reading an article or review, you can trust that you're receiving trustworthy and reliable information.

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You have money questions. Bankrate can help. Our experts have helped you understand your finances for more than four years. We are constantly striving to give our customers the right advice and tools required to make it through life's financial journey. Bankrate adheres to strict standards standard of conduct, which means that you can trust that our information is trustworthy and reliable. Our award-winning editors and reporters provide honest and trustworthy content that will help you make the right financial decisions. The content we create by our editorial staff is factual, objective and uninfluenced by our advertisers. We're transparent about how we are capable of bringing high-quality information, competitive rates and useful tools to you by explaining how we earn our money. Bankrate.com is an independent, advertising-supported publisher and comparison service. We receive compensation for placement of sponsored products and services or by you clicking on certain hyperlinks on our site. This compensation could influence the manner, place and in what order products appear within listing categories and categories, unless it is prohibited by law. This is the case for our mortgage home equity, mortgage and other home lending products. Other factors, like our own rules for our website and whether a product is available within your area or at your self-selected credit score range can also impact the way and place products are listed on this website. We strive to provide an array of offers, Bankrate does not include details about every credit or financial product or service.

A new car is an exciting moment. However, before you decide on an SUV or a truck in red or black first, you need to decide whether to lease or buy your next car. Leases can result in more affordable monthly payment. However, the savings in cost may not be enough to cover the negatives of leasing, which makes buying cars the better option. The advantages of leasing a car vs. purchasing: A review leasing and buying are both viable options to get your hands on a brand-new car. Buying offers on how much you can drive and the features it is you could do with the vehicle. In addition, you have the car at the close of the loan. However, leasing is a more expensive option month-to-month when you are looking to invest into a luxurious car. The decision to lease or buy depends on : the miles you expect to travel, the amount of money you are willing to spend and the vehicle's purpose. Use a is better for your budget. What kind of leasing plan is the best? Leasing is the ideal option for you if are looking to get behind the wheel of a vehicle without having to make a significant investment of money upfront. Leasing eases the monthly cost to a manageable amount. It also lets you take advantage of a luxury vehicle than you might otherwise have the money to purchase. But keep in mind the potential wear and tear charges that come along with leasing. If you enjoy long road trips, leasing might not be the right choice for you. Which type of buyer is the best? If you want to be completely in control of your car and financial situation purchasing a car could be the best option for you. There is no need to worry about the mileage limit or additional costs for things like wear and tear. While acquiring the process of obtaining a loan takes some extra homework, you will have full control over the car and are able to sell it anytime which is something that leasing doesn't provide. A car is leased when you purchase the privilege of driving the car for a predetermined period of time, typically three or four years. Most leases are financed through the dealer. It is typical to pay an initial amount prior to taking your brand new car off the lot to cover taxes and fees. After that, you'll pay monthly for the duration of the lease in order to pay the costs of depreciation. There are typically restrictions on the number of miles you're allowed to drive the car during the lease term. The vehicle must be returned vehicle to the dealer in excellent state to avoid any additional charges. Benefits of leasing a car leasing comes with a variety of benefits that can lead to significant cost savings. Pay less. If you're trying to keep your spending under control the leasing of a more modern car is more affordable month-to-month than purchasing one. Less money down. Alongside the amount you'll be paying throughout leasing, your initial shock may not be as severe: You may be in a position to drive off the lot without putting any cash down. Manufacture warranty options. When you've got the keys you'll likely get the benefit of warranty protection that typically will last for the first three years or 36,000 miles. The drawbacks of leasing a vehicle However, leases are not without restrictions , as well as other disadvantages to be considered before signing the to sign the. Mileage restrictions. The majority of leases include annual mileage limits, usually with a range of 10,000-15,000 miles. If you exceed the limits, you'll pay a premium which is typically thirty cents for each mile. Additional costs. There are additional fees for any wear and tear that's deemed "excessive." That can include all things that go beyond minor scratches and dings. You won't own it at the end of. Except for an option -- which will most likely require financingyour monthly payments will continue when you either renew your lease or lease a new vehicle. This means you'll never be paying for your car and you will never own the vehicle. When you purchase a vehicle means you maintain possession of the car instead of leasing it for a short period of time. If you are looking for a brand-new car, it may come with a significant price. The price of an all-new car for June 20, 2022, was over $48,000, as per data from . There are other less costly choices for purchasing a vehicle but they are not as affordable, like (CPO) and . If you purchase a new car using a loan the cost for your monthly payments is typically higher than leasing. However, the vehicle is officially yours once it's paid off. Benefits of buying a car Buying allows you to build equity in an asset that is valuable as well as other benefits. There are no mileage limitations. If you purchase a car and you don't need to monitor your mileage. If you're planning to rack up 100,000 miles over the course of a year, you can do so without having to worry about any additional costs. There are no wear and tear charges. There is no need to fret about what a dealer deems normal wear and tear. The ability to sell or trade in the car. Because the vehicle is yours to keep, you won't have to worry about what you should do once your car loan is paid in full. When you're ready for a new vehicle, trade in the car or make a trade based on the mileage and condition. Drawbacks of buying a car It's not without downsides. Higher monthly payments. When you buy a car and pay for it, you'll probably have to pay more every month. As an example, the median monthly payment for those who bought the Toyota RAV4 for $578 -- $131 higher than the average monthly installment for leasing it, according to report from the 4th quarter 2022. A bigger down payment is needed. If you put in a down payment, you will reduce the amount you'll need to borrow and -- by extension -- those monthly payments, however it will consume a bigger part from your money. Maintenance costs for the long-term. In the end, owning a car means paying to fix it whenever something goes wrong. The warranty may cover some things, but once that expires, you'll become fully responsible. Last considerations, whether you decide to lease or buy an automobile, you need to keep in mind a few important aspects. Your is the primary measure of your financial ability to pay the monthly installments. Aim for a score between 680 and 740 for leasing, and 660 or higher if you choose to buy. Here's the reason why, as outlined by Experian's State of the Market report The monthly loan payment for subprime buyers who have credit scores between 501 and 600, was $602, in comparison to $558 for super-prime people with credit scores ranging from 781 and 850. The median monthly cost for used auto loans of $542 was $505 in both cases. Customers who bought new vehicles paid $746 and $683 per month, respectively. Additionally, you can choose the year or week when you decide to head to the dealer. Holidays or colder months may mean you walk away with an advantage. The main thing to consider is whether you should lease or purchase a car depends on an in-depth analysis of your budget and your driving habits. Consider the amount you can afford to pay monthly in advance and think about the number of miles you drive on the road in order to find the most affordable route to take. When you know what kind of car you want, crunch the numbers with the lease versus purchase calculator. Also, shop around to finance and compare rates to ensure that you make the right financial decision.

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Written by Auto Loans Reporter

Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers with the ways and pitfalls of borrowing money to purchase a car.

Editor: Rhys Subitch Edited by Auto loans editor

Rhys has been writing and editing for Bankrate since late 2021. They are dedicated to helping readers gain confidence to take control of their finances with concise, well-researched and well-researched content that break down complex topics into manageable bites.

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2 min read Published June 30, 2022

Writer: Kellye Guinan. Written by personal and business finance contributor Kellye Guinan is a freelance editor and writer with over five years of experience in personal financial planning. She is also an employee full-time at her local library where she helps people in her community gain access to information on financial literacy, in addition to other subjects. Written by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate from late 2021. They are dedicated to helping readers gain confidence to control their finances by providing concise, well-researched and well-documented facts that break down complicated subjects into digestible pieces. The Bankrate promise

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We receive compensation for the promotion of sponsored goods and, services, or by you clicking on certain hyperlinks on our site. So, this compensation can impact how, where and in what order items appear within listing categories in the event that they are not permitted by law. This is the case for our mortgage or home equity products, as well as other products for home loans. Other factors, such as our own proprietary website rules and whether or not a product is offered in the area you reside in or is within your own personal credit score could also affect the way and place products are listed on this website. While we strive to provide a wide range offers, Bankrate does not include specific information on each credit or financial product or service. Prepayment penalties can prevent you from saving interest. There are many lenders that have this -however, it is getting more common, however, you are able to request changes in the method by which payments are applied. You may also refinance, but be prepared to pay a charge to end your current contract. What is a prepayment clause? prepayment clauses define the time and manner in which the borrower may pay off a loan. Some may have an early payment penalty, the cost of paying off the loan earlier or making additional payments. This is particularly prevalent with auto loans which have precomputed interest. There is a possibility of a partial refund or rebate, but it won't pay the entire amount of interest you paid. The penalties for prepayment make it hard to reduce the principal or . If you're loan is at a high interest rate, you'll be paying a substantial sum to the lender but not in a position to lower the principal. Because cars depreciate in value, the more you pay in interest, the more likely to end up . Prepayment clauses impact the auto loans The two main ways prepayment clauses impact your . You may not be able to pay the principal down A prepayment clause may make it impossible to pay principal down. The extra amount goes toward your next monthly payment. It can be helpful in the event of a crisis by reducing the amount that you have to pay month-to-month, however you'll still have to pay an enormous sum of interest. The process of refinancing can be more challenging. A prepayment clause may include the possibility of a penalty for prepayment that can make refinancing more expensive than it's worth. If you can save on interest by switching to a different lender and you're able to manage to break even. How to stay clear of auto loan prepayment penalties It is possible to avoid prepayment penalties for your auto loan. However, the precise method for staying clear of them will depend on the goals you're trying to achieve. If you're in the market for an loan Talk about penalties for early payment in conjunction with the lender. You want to be up on the front. Many lenders, such as banks and credit unions -- don't have prepayment clauses in their agreements. You can avoid a lot of future headaches by ensuring that you have this clause in place prior to taking out an loan. If you're looking to refinance Follow the same process when you compare lenders. Compare alternatives that don't impose the prepayment clause. Once you refinance it, you'll be in a position to make the additional payments you want. Be aware of the costs associated with refinancing if your current loan is subject to prepayment penalties. Utilize an application to determine whether refinancing is a good idea to your budget. Calculate the cost as a percentage of your current loan amount to decide if refinancing is worth it. If you're satisfied with your loan negotiations with your current lender can be a viable alternative if you do not want to refinance. You may request extra installments to be applied to your principal, even if there is a prepayment clause. But this is far from guaranteed. Most lenders won't modify the terms of a loan contract without good reason. Be aware that some lenders don't have prepayment clauses , but require additional payments for interest first. Call your lender and ask them to let the money be put towards the principal. If there's not a prepayment clause, your lender must comply. The bottom line Not all states allow prepayment penalties , and there is no way that a lender can charge one on an over 60-month contract. But if your contract already includes one you can overcome it. Start by getting in touch to your lender and asking them to allow payments to be applied differently. If that doesn't work, think about refinancing. Even with a penalty for prepayment, you may be able to save money on interest for the duration of your car loan. Learn more

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Written by personal and business Finance contributor Kellye Guinan is a freelance editor and writer with more than 5 years experience working in the field of personal finance. She is also employed full-time at the local library where she helps the community gain access to information on financial literacy, as well as other subjects. Edited by Rhys Subitch Edited by Auto loans editor Rhys has been editing and writing for Bankrate since the end of 2021. They are dedicated to helping their readers feel confident to manage their finances with concise, well-researched, and well-structured information that breaks down complicated topics into digestible pieces.

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