Frequently Asked Questions About Car loans in Illinois

Will you have a co-signer?

YES   NO

Here are some common questions about getting a car loan in Illinois.

Do I really need a down payment?

If you have enough cash to pay at least 20 percent of the car's purchase price, you probably won't need gap insurance. If gap insurance would be required on your loan if you don't have a down payment, this could really save you some money. It's also a good way to show your lender that you are financially stable.

Is APR the same as interest rate?

APR means "Annual Percentage Rate," and it is an important number because it lets you know how much your loan will end up costing you. So if your car's total price is $10,000, and you get a loan for that amount over a four year period at an APR of 10 percent, the total you will be paying for your car will be $12,174.24. That means the price of your loan was $2,174.24. An "interest rate" is the money a lender receives for giving you the loan.

Is it better to have a longer loan term so my monthly payments will be smaller?

Loan terms are typically expressed in terms of months. While your monthly payments will be lower if you have a longer loan term, the problem is that you will end up paying way more interest. This could cause you to owe more money than the car is worth.

Can I get a car loan in Illinois with bad or no credit?

It is a lot easier to get vehicle financing than you may think, even with credit issues, no credit, or a bankruptcy. If someone will co-sign the loan for you, and/or if you have proof of a steady job, you will be able to start repairing your credit predicament while getting your car at the same time.

Should I get a loan first, or decide which car I want first?

The most important item on your car-buying agenda is to get an approved loan. Once you've got a dollar amount available to you, you'll be able to pick a car within that price range. And it's better not to moon away over that sportscar, only to find out your budget puts you in an economy car.

If I apply for car loans with several lenders, will my credit score drop?

Right now, the major credit agencies maintain that every inquiry relating to a specific type of acquisition (such as home or vehicle loans) will count as one inquiry for credit scoring purposes, as long as they all take place within one fourteen-day period.