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How to Get the Best Auto Loan in Miami

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Are you looking for an auto loan to buy a car in Miami? There’s nothing like driving off the lot in a new vehicle. Before that happens, however, you'll want to ensure you've found the right loan at the best interest rate.
We've compiled this comprehensive guide to help you navigate the process and find the best auto loan rates in Miami.

Know Before You Go
The first step to finding the best interest rate is understanding the different auto loan types available. Ideally, you should have this knowledge before applying for a loan or heading to a dealership. Lenders typically offer three types of auto loans: secured, unsecured, and personal.
Secured: A secured loan is backed by collateral, such as the car you purchase. These loans tend to be the most accessible type since they're less risky for lenders.
Unsecured: An unsecured loan is not backed by collateral and is based solely on your credit score. This is a common type of loan, but it usually comes with stricter lending requirements since it’s riskier for lenders.
Personal: A personal loan is an unsecured loan for any purpose, including buying a car.

Compare and Contrast
Once you understand the different auto loan types, the next step is to compare loan interest rates. This is key for drivers in Florida because they are in the top five states with the highest car loan balances. Here are some fast facts about car loans in Florida:
  • Floridians carry an average of $5,980 in auto loan debt
  • The average monthly car payment is $470.24
  • Used cars sell for $33,229 on average in the Sunshine State
Since buying a car is an investment, shopping around and finding the best loan is essential. Here are some guidelines concerning auto loans:
  • The most common term length is 60 to 72 months or five to six years.
  • Auto loans have simple interest, not compound interest. This means you pay the car price plus a flat percentage of the amount borrowed instead of accumulating interest over time.
  • Having a good credit score often means getting a better interest rate; also, the more you put down upfront, the better your rate might be.
To get the best auto loan rate, shop around and get information from several lenders. This takes a little extra time but can save you money in the long run. For example, dealerships can help you with financing, but it’s not a bad idea to get pre-approved by a bank or credit union first.

Going to the dealership with this knowledge lets you snag the best deal possible, and online tools make it easier than ever. Use an online auto loan calculator like this to see how a loan will fit into your budget. Make sure to compare each lender’s interest rates, loan terms, and fees while shopping around.
In addition to traditional lenders, you can also consider online lenders when looking for an auto loan. The drawbacks to online lenders can include inadequate customer service and fewer (if any) personalized options to suit your financial needs. In addition, if being able to visit a physical office location is essential to you, you might not find this with many online lenders. As always, shopping around and learning about your options is critical.

Helpful Resources

Another great reason to get pre-approved is that you're in the driver's seat while working with a salesperson at the dealership. Knowledge is power and understanding how much loan you can genuinely afford puts you in control. Learn how to get pre-approved for an auto loan.
Pre-approval is particularly important because you may feel pressured into signing for a loan by the car dealership. However, there are better ideas for your budget. Discover why zero-percent financing is too good to be true and learn about the car-buying process.
Ready to start your search for the best auto loan rates in Miami? Power Financial Credit Union has the experience and personal touch to navigate the car-buying process easily. Contact us today to learn how we can help you find the car (and auto loan) of your dreams.