An auto loan is a financial product aimed at purchasing a vehicle. Despite its name, with the help of an auto loan, you can buy not only a car but also a motorcycle, a boat, or a motorhome. Auto loans are usually simple interest loans that must be repaid within three or five years.
Auto loans help to make cars more affordable because the high cost is broken down into monthly payments that suit the different budgets of the borrower.
How does an auto loan work?
Auto loans are repaid in monthly payments. Such payments consist of the loan amount and interest determined by the lender.
The interest rate on a car loan can vary depending on the borrower’s credit history and the lender’s conditions. For example, we at Markesan State Bank offer car loans from 5.1% to 14.7% APR.
The term of a car loan can also vary. The most common repayment terms for such a loan are three or five years. However, our bank offers car loans for a period of two to seven years.
Auto loans for used vehicles
If you are going to buy a vehicle that has been used before but you do not have enough funds, you can also apply for a car loan.
We provide loans for used cars, motorcycles, and boats at Markesan State Bank. At the same time, the interest rate on such loans will be slightly higher – from 6.7%.
Requirements for getting an auto loan
In order to get a car loan, you just need to fill out an application on the site. If you prefer to meet in person, you can also do so at our bank.
Please note that in order to complete the application, you will need the following:
- Social Security number
- Current and past addresses
- Current and past employment information
- Income and income sources
- Information on any other debt you may have
If you are not sure that you want to take a loan, then we suggest that you go through pre-qualification. It will not affect your credit score, but we will be able to provide you with a more personalized offer. In addition, since interest rates are formed taking into account your information, after passing the pre-qualification, you will know how much you can count on and how much you will have to pay on loan.
What to do if you are unable to pay the loan?
We at Markesan State Bank know that sometimes life can change dramatically. And unfortunately, sometimes, our borrowers are temporarily unable to make payments on their loans. If this has happened to you, please let us know first. In this case, the bank, based on the circumstances, may offer you an extension or deferred payment. In addition, together, we can develop a different repayment plan.
If you do not notify us of the circumstances and simply stop paying, we will be forced to charge late fees. In addition, as a result of the default, we will have to confiscate your vehicle in order to auction it off and pay off your debt.