Getting an Auto Loan from a Credit Union

Auto loans from a credit union provide benefits of buying a new car without some of the potential pitfalls found when working with auto dealerships directly. Not only do Credit Unions offer better rates than those found at traditional banks, they also provide members with a pre-approval on the car loan, car buying service to help make the buying process hassle-free, and enable their members to enjoy the comfort and reliability of driving a new vehicle, while saving money over the long run.

These tips can help members find a car that fit their budgets:

• Get pre-approved – This way you know exactly how much money you can spend on a car.
• Car Buying Service – Just tell them what make, model, and year you are looking for and what you have been pre-approved for, let them do the haggling for you. They will find the right car for you, get the paperwork ready, and all you have to do it go to the dealer and pick up the car.
• Be certain the car fits personal needs – Just because a two-door sports car with a fast engine may have a loan payment that fits in the budget doesn’t mean it’s the right choice. Consider day-to-day needs, storage capacity, gas mileage and other related points to find a good make and model to choose.
• Make sure the vehicle has positive performance reviews – Usually the car you select will be around for up to five years based on the term of your loan. Reliability and performance will matter, which means doing some basic research before selecting a model is in order.
• Find out the costs associated with driving the vehicle of choice –Be sure to also look into anticipated insurance pricing, maintenance costs and other associated expenses before making a final selection.
• Are you using a vehicle for trade-in – Reputable auto dealerships not only accept trade-ins, they work with prospective buyers to gain the highest trade-in values possible. This can help contain overall and monthly costs nicely.
• Consider the length of the auto loan – Increasing the number of months of your car loan from three to four years, for example, can cut monthly costs. Your credit union will work with you to find the terms that will fit within your budget.
• Consider getting additional GAP insurance for those unexpected expenses.

Credit unions tend to charge lower interest rates for auto loans – Since credit unions are focused on serving their members – rather than earning profits – they tend to offer loans at lower interest rates by funneling those earnings back to their members through better rates and lower fees. This helps members keep more money in their pockets each month and can also help members pay back their loan sooner.

When choosing the right car to buy, be sure to consider not only pricing, but also quality, capacity and associated costs before making a final choice.

About Author

Based in Dallas TX, GO Federal Credit Union has committed itself to empowering its members through meeting their various financial needs. Like any other credit union, GOFCU is also a not-for-profit financial institution.