Auto financing has reached a new level of convenience. Now, getting an auto loan can be as simple as applying online from the comfort of your couch.
However, before you choose this option there are many factors to consider. While convenience is undoubtedly present when getting auto financing online, there are also risks and concerns to think about before making your decision. Don’t proceed until you get all of the details about auto financing online.
Advantages Of Auto Financing Online
When you get auto financing through an online lender, you’re sure to experience several advantages. Here are a few that stand out most.
Experience the convenience
First and foremost, auto financing online can be very convenient. When you go this route, you can apply online from home or anywhere you are. There are no time restraints, so you can do so day or night.
Also, the decision process is fairly quick, and you usually get your results promptly, sometimes within just a few minutes.
Get a preapproval
The preapproval process is the step before completing the full auto loan. It lets you know how much you can qualify for along with your interest rate and monthly payment.
When you take this to a dealership, there’s an understanding that you’re serious about getting a vehicle. You can then focus on securing a reasonable price for your car instead of worrying about how you’re going to pay for it or whether you’ll have enough funding to cover the cost.
When you know your maximum loan amount in advance, it makes for an easier car shopping experience since you can quickly eliminate vehicles outside of your budget.
Access to more lenders
Another benefit of auto financing online is your access to more lenders. You aren’t limited to local or even state-wide lenders or dealerships. Instead, you can find lenders anywhere to get your loan. This gives you more opportunities to shop around by applying with different lenders and comparing interest rates, fees, and other loan terms to find the best deal.
Lower interest rates
When you get auto financing online, you will often secure a lower interest rate, as well. This is because lenders have to offer more competitive interest rates to compete with other online lenders.
Some can also offer lower interest rates due to lower overhead costs if they’re strictly online or have fewer branch locations. Keep in mind that credit unions often provide some of the lowest interest rates due to their nonprofit status.
Avoid dealer-arranged financing
Another significant benefit is that you can avoid dealer-arranged funding if you get your auto loan online. When you get an auto loan at a dealership, you’re likely to pay a higher interest rate and more in fees so the dealer can make a profit.
Avoid paying more and spending extra time in the often high-pressure dealership environment by skipping financing at the dealership.
Disadvantages Of Auto Financing Online
While there’s no denying the benefits of getting auto financing online, you can’t disregard the potential disadvantages of this financing option, as well.
Risk of online-only lenders
If you work with lenders that are only available online, there might be some risk involved.
Online-only lenders might be newer or unfamiliar to you with less of a traceable track record to review. You want to be sure to only work with online lenders that have a history of providing excellent car loan service to their customers.
Customer service may be limited
Some online auto financing companies have limited customer service availability. It may be automated, or you might find it challenging to get in contact with someone over the phone.
Also, if fewer people are reviewing applications, it can be more difficult for the online lender to get a full picture of your history to provide a fair decision.
Consider A Credit Union For Auto Financing Online
When looking for auto financing online, choosing a credit union can give you all of the benefits without the disadvantages. Most credit unions have an online auto financing process, but you can also visit a local branch or quickly get in contact with one of the customer service representatives.
Instead of your application being managed by a machine, credit unions offer personalized service, so there’s a person reviewing applications. This allows for some leniency if you have less than perfect credit or need to explain something within your application or financial background. Also, if you have any questions, a customer service representative is available, ready, and willing to help you.
Finally, as mentioned previously, credit unions often offer some of the lowest loan interest rates due to their nonprofit status. A lower interest rate allows you to pay less for your vehicle over the length of your loan.
Is Getting Auto Financing Online Right For You?
Now that you have the details about auto financing online, you have to decide whether this is the right option for you. Many people prefer going this route, while others stick to the traditional method of auto financing.
If you want to experience all of the benefits of auto financing online without the cons of potential poor customer service, we recommend that you try applying at a credit union. Wasatch Peaks Credit Union offers an easy and convenient auto loan process you don’t want to miss out on.