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Auto Loan, Reviews

Review: Bank of America Auto Loan

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Bank of America Auto Loan

Shopping for a new or used car has become a complicated experience. There are so many makes and models to choose from, so many dealers to purchase from, and a range of prices that makes it hard to see if whether or not you’re getting the best deal.

It can be overwhelming, to say the least.

That overwhelming feeling can lead so questionable financial decisions, such as spending more than you can afford, paying too much for the car you choose, and spending hundreds or thousands more in interest than necessary because you didn’t shop around for the best rate.

The Offer

A Bank of America auto loan will provide 12 to 60 months with APRs starting at 2.89%. There is no origination fee, but Bank of America does not provide online pre-approval for new or used auto loans. You can, however, be pre-approved for a new dealer purchase by applying at a Bank of America branch.

APR discounts

Bank of America provides several APR discounts to its existing customers as well as Preferred Rewards Customers.

Current Bank of America personal checking account holders receive a 0.15% APR discount on their auto loans or auto refinances.

Bank of America also offers an APR discount of 0.25% to 0.50% on auto loans when you enroll in Preferred Rewards at the time of application. There are no fees to participate in Preferred Rewards, but you must have a Bank of America personal checking account and a 3-month average combined balance of $20,000 in your Bank of America accounts and/or Merrill Lynch investment accounts.

Car Buying Basics

The first thing you should do when considering a new or used car purchase is to take hard look at your budget. Consider all of your current debt payments – these should not exceed 50% of your income. Factor in the payment for your new car, and make sure that it will not stretch your budget too thin.

Then, shop around online for your best rate on an auto loan during a 30-day period. Doing all of your rate shopping within 30 days will result in minimal impact because all inquiries within a 30-day period are treated as a single inquiry.

Once you have secured financing and determined the budget for your vehicle, use a site like TrueCar or Kelly Blue Book to help you determine the best price for the car you want to buy by comparing what other people actually paid for the same model.

How To Apply

In order to apply for an auto loan from Bank of America, you must be at least 18 years of age (19 in Alabama or Nebraska). You should also be prepared with the following:

  • Your address, phone number, email address, and Social Security number
  • Employment and income verification
  • Information on the vehicle you wish to purchase, such as the make, model, mileage, and the VIN

In most cases, you will receive approval or denial within 60 seconds of submitting your application with all of the required information online. However, some applicants will require a more detailed review. If you do not receive a decision within 60 seconds you will be contacted by email when the decision regarding your loan is ready.

In some cases, you could receive your funds in as little as 24 hours.

After you apply and are approved for the loan, you have 30 days from the date of the original loan request to use it without being required to re-apply.

The Fine Print

The 2.89% starting APR is only valid in certain states. Go here to check yours. The 2.89% APR assumes an excellent credit history and that you are purchasing a new vehicle from a dealership. Other types of purchases have the following minimum APRs:

  • Dealer Used: 3.19%
  • Private Party: 3.99%
  • Refinance: 3.19%
  • Lease Buyout: 3.19%

Your actual APR may be higher depending upon your creditworthiness, as well as the state in which you reside.

In order to finance a used vehicle through Bank of America, it must be not be older than 10 calendar years, have no more than 125,000 miles, and not be used for commercial purposes. It also cannot have a salvage title.

Bank of America does not finance auto purchases from independent dealers that carry several different brands of vehicles. The general exceptions to this rule are CarMax, Hertz Car Sales, Enterprise Car Sales and other found using this dealer locator tool.

In same cases, if the applicant is not deemed creditworthy enough, Bank of America will require a down payment or minimum loan to value ratio. These are determined on case-by-case basis and will not be known until you apply.

Pros

  • Rates starting at 2.89%
  • Terms of 12 to 60 months
  • 60 second online approval, in some cases
  • Funds in as little as 24 hours
  • Will finance private party sales and lease buyouts
  • No origination fee
  • No prepayment penalties
  • Up to 0.50% APR discount when you enroll in Preferred Rewards
  • 15% discount for having a Bank of America Checking account

Cons

  • Exact APR is not known until you apply
  • Down payment may be required for certain applicants
  • Will not finance purchases from independent dealers
  • Used cars must be less than 10 years old and have less than 125,000 miles
  • No online pre-approval

How It Stacks Up

LendingTree

If you want to explore your options, there are hundreds of lenders on LendingTree ready to compete for your business. LendingTree is the parent company of MagnifyMoney. You simply have to fill out a short online form and upon completion, you may see real interest rates and approval information instantly. While the online form is only a soft pull on your credit, meaning your score won’t be impacted, if you choose to move forward with a lender, lenders will likely do a hard pull on your credit.  Note that since multiple hard pulls only count as one pull, it is smart to have all your hard pulls done at once.

LightStream

LightStream can beat Bank of America’s starting APR and is far less complex. Its APRs start at 2.19%, it will finance vehicles up to $100,000, and it does allow you to receive pre-approval online before shopping. Its terms vary from 24 to 84 months, which allows for longer terms than Bank of America.

PenFed

If you like great rates, but a more personalized experience than a big bank provides, then consider PenFed. PenFed is a credit union, but anyone can join with a one-time donation to an eligible charitable donation. It has APRs ranging from 1.49% to 3.84%, terms of 12 to 84 months, and will finance up to $100,000. It has no origination fee, but does not provide online pre approval.

Shop Around First

When purchasing a new or used car, the two most important factors are making sure you don’t spend more on a vehicle than you can afford, and getting the best rate possible. Before setting foot on a dealership, shop around for your best auto loan rate so you can have one aspect of car shopping taken care of up front.

Compare Auto Loan Offers Here.

Gretchen Lindow
Gretchen Lindow |

Gretchen Lindow is a writer at MagnifyMoney. You can email Gretchen at gretchen@magnifymoney.com

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Auto Loan, Reviews

Review: Navy Federal Credit Union Auto Loan

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

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Navy Federal CU Are you shopping around for the best auto loan rates before you buy a car? If not, you should be. It helps to get an idea of the type of loan you’ll be approved for before you make a trip to the dealership. Plus, credit unions offer some of the best rates out there – comparable with dealer financing, especially when it comes to new vehicles.

Navy Federal Credit Union (NFCU) offers auto loans with rates ranging from 1.99% to 17.99% for those eligible for membership (which includes most any Active Duty members or retirees of various military branches).

What credit score do you need?

If you have a credit score of 700 or above, that will help you obtain the best auto loan rates possible.

NFCU Auto Loan Details

NFCU offers rates as low as 1.99% APR on new and late model used vehicles. Rates and terms are dependent upon the model year of the car you choose, which can make the details a little confusing.

We asked a representative from NFCU to give us a quote on a new and used vehicle at the lowest and highest APRs so you can get an idea of the range of options available. (Only the lowest rates are listed on the website.)

Auto Loan Rates

As of: December 5, 2017, 1:00 AM EST

Loan Type

up to 36 mos.
APR as low as*

37-60 mos.
APR as low as*

61-72 mos.
APR as low as*

73-84 mos.
APR as low as*

85-96 mos.
APR as low as*

New Vehicle

1.99% 

2.39% 

2.69% 

4.09% 

4.89% 

Late Model Used Vehicle

1.99% 

2.79% 

3.49% 

Used Vehicle

3.79% 

3.99% 

5.29% 

 

Keep in mind you can apply for any amount you want. Once you submit your application, NFCU will determine whether or not you’re qualified for that amount.

New vehicle financing: NFCU defines a new vehicle as a 2014, 2015, or 2016 model year with less than 7,499 miles. The APR ranges from 1.99% to 13.29% on terms up to 36 months; 2.39% to 15.29% on terms of 37-60 months; 2.69% to 16.09% on terms of 61-72 months; 4.09% to 17.99% on terms of 73-84 months; and 4.89% to 17.99% on terms of 85-96 months.

Late model used vehicle financing: NFCU defines a late model used vehicle as a 2014, 2015, or 2016 with 7,500 – 30,000 miles on it. APRs are as low as 1.99% on terms up to 36 months; 2.79% on terms of 37-60 months, and 3.49% on terms of 61-72 months.

Used vehicle financing: NFCU defines a used vehicle as any vehicle with over 30,001 miles. The APR ranges from 3.79% to 17.09% on terms up to 36 months; 3.99% to 17.89% on terms of 37-60 months; and 5.29% to 17.99% on terms of 61-72 months.

As you can see, new vehicles have the most favorable financing and terms – 96 months is offered only for new vehicles. Used vehicles are limited to loans up to 72 months, and have the highest maximum APR.

Not having access to longer terms isn’t necessarily a bad thing considering we wouldn’t recommend you take an auto loan for a term greater than 60 months. The longer your term is, the more you’re going to pay over the life of the loan. No one wants to be paying a car loan back for 8 years. Stick to your budget and remember not to focus solely on the monthly payment – take the overall cost of the loan into consideration.

There’s a useful auto loan calculator on NFCU’s page where you can estimate what your payments will be. For example, if you financed a new vehicle for $15,000 on a 1.49% APR for 36 months, your monthly payment will be $426.00. Financing a used vehicle for $15,000 on a 3.59% APR for 36 months results in a monthly payment of $440.00.

How to Apply for an Auto Loan With NFCU

To apply for an auto loan with NFCU, you need to be a member. When you click “Apply Now” on the website, you’re directed to the login page, so you need to register to fill out an online application.

If you want to apply over the phone, you’ll need to enter your access number and telephone password before applying and speaking with a representative.

The application process doesn’t take very long. Customer reviews mention filling the application out in five to ten minutes and being approved within a few hours. A representative we spoke with said pre-approvals and approvals generally take about 24 hours to process, but some customers are approved instantly, while others receive an answer in just a few hours.

Documents and Information Needed to Apply

The information you need to provide depends on what stage of the car-buying process you’re in. You’ll be required to give your personal information either way.

If you’re still shopping for a car and looking for a pre-approval, you’ll need:

  • Any trade-in details if you’re planning on trading your current car in
  • The total amount you think you’ll need for financing (include all fees minus the down payment)
  • Term of the loan

Pre-approvals are only good for 60 days and can’t be used for a private seller. If you use the pre-approval at a dealership, the dealer must call NFCU and obtain a validation code, which has to be written on the pre-approval draft. NFCU needs to receive the draft from the dealer. Once it’s paid, you’ll receive a promissory note.

If you already know the car you want to buy, you’ll need:

  • The VIN of the vehicle
  • The exact mileage
  • The state where the car will be registered
  • The dealer or seller’s name
  • Trade-in details, if applicable
  • The total amount being financed (includes fees)
  • Term of the loan

You can choose to have a check sent to you via Fedex (for free), or you can pick up the check at a local branch.

The Fine Print

There are no additional fees associated with NFCU’s auto loan.

Rates are based on your credit (having a FICO score over 700 helps) and the year model of the car you’re looking to finance.

Pros and Cons of NFCU’s Auto Loan

Pro: Optional guaranteed asset protection (GAP) is offered for a flat fee of $199 that can be rolled into the financing. This covers you in case your vehicle ever gets totaled or is stolen, and the amount the insurance company is willing to pay doesn’t cover the outstanding loan balance.

Con: The membership requirements are a bit strict. If you don’t know anyone that has served in the military, or has civilian connections to the military, you might not be eligible to join.

Pro: Active duty or retirees are eligible for a 1/4% APR discount if they apply at a branch or via phone. Those that have been members of NFCU for 25 or more years are also eligible for the discount. However, this benefit is limited as you can’t go under the 1.49% APR minimum.

Con: The APR range is on the higher side compared with the rest of the lenders on our list. If your credit isn’t the best, you shouldn’t have to settle for a 17.99% APR.

Pro: NFCU offers a live chat feature in case you have any questions about the loan, and it offers phone support as well. For the live chat, all you need to enter is your name – you don’t need to share any personal information beyond that.

Membership Requirements for NFCU

Since NFCU is a credit union, you must meet the eligibility requirements to join and apply for an auto loan. If you’re Active Duty and in the Army, Navy, Marines, Air Force, Coast Guard, Army or National Guard, a member of the Delayed Entry Program, a Department of Defense (DoD) Officer Candidate/ROTC, DoD Reservist, or a retiree from any service branch, you qualify for membership.

You can also qualify if you work at the DoD as a civilian employee, if you’re a U.S. Government employee assigned to a DoD installation, if you’re a DoD contractor assigned to a U.S. Government installation, or a DoD retiree.

Lastly, if you’re an immediate family member of someone who’s a member or who is eligible for membership, you can join. Immediate family members are grandparents, parents, spouses, siblings, grandchildren, children (adopted and stepchildren), and members of your household.

Not surprisingly, there’s a heavy emphasis on military duty with the NFCU. Those who are Active Duty or retired service members are eligible for a 1/4% APR discount, and they’re the ones most likely to benefit from an auto loan with NFCU.

Comparable Auto Loans

Aren’t eligible to join NFCU? There are still great options out there for an auto loan. If none of the below options work for you, or the ones on our auto loan table, we encourage you to reach out to your local credit union, as they tend to offer the best rates for auto loans.

LendingTree:  There are hundreds of lenders on LendingTree ready to compete for your business. LendingTree is the parent company of MagnifyMoney. All you have to do is fill out a short online form. Upon completion, you can see real interest rates and approval information at once. Some lenders may do a hard pull on your credit and this is normal with auto lending. Keep in mind that multiple hard pulls only count as one pull, so the best strategy is to have all your hard pulls done at once.


LendingTree

LEARN MORE  

NEFCU: Loans are offered on the same terms of 12 to 96 months, but rates are slightly lower, beginning at 1.45% and going up to 13.99%. The maximum amount you can finance is $70,000, and there is no origination fee. Membership to NEFCU is very limited.

PenFed Credit Union: You can secure financing on terms of 12 to 84 months with rates from 1.49% to 2.99% on new cars and 1.99% to 3.61% on used cars. You can finance between $500 and $100,000, and there is no origination fee with this loan. Anyone can join PenFed, either by having eligibility under its scope of membership or by making a contribution to one of two designated charitable organizations.

Shop Around Before You Settle on a Lender

Regardless of which lender you go with, make sure you continue to shop around for the best loan possible. All credit inquiries that occur within 30 days are counted as one inquiry, so you won’t be penalized for it. Take advantage of that and secure the best rate you can get.

Compare Auto Loan Offers Here.

Erin Millard
Erin Millard |

Erin Millard is a writer at MagnifyMoney. You can email Erin at erinm@magnifymoney.com

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Auto Loan, Reviews

Review: NEFCU Auto Loan for New and Used Cars

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Car_lg (1)

Shopping for a new or used car can be a stressful experience – but it does not have to be.

In order to make an educated and simplified decision it is best to walk into the dealership with low interest financing already preapproved. Knowing that you already have financing taken care of, negotiate the price of your car and then show the dealership your financing offer.

Chances are the dealership will try to beat your financing by offering you 0% financing through the manufacturer – which could save you thousands of dollars in interest over the life of the loan.   If you are offered 0% financing, take it and feel good about your savings. If not, you already shopped around for the lowest rate and you can continue on with your vehicle purchase.

The Offer

NEFCU finances auto loans up to $70,000 with no origination fee and rates ranging from 1.45% to 13.99%. You can choose terms of 12 to 96 months, but NEFCU does not offer online preapproval.

Membership Requirements

Because NEFCU is a credit union, you must be a member in order to apply for an auto loan. You are eligible for NEFCU if you:

  • Live in Nassau and/or Suffolk Counties
  • Work in Nassau and/or Suffolk Counties
  • Worship in Nassau and/or Suffolk Counties
  • Attend school in Nassau and/or Suffolk Counties
  • Regularly conduct business in Nassau and/or Suffolk Counties
  • Family Sponsorship – An existing NEFCU member can sponsor in an immediate family member (mother/father, brother/sister, child, grandparent or grandchild) or any household member
  • Membership is not open to individuals who live, work, worship, attend school and do business exclusively in East Hampton, Southampton and Shelter Island.
  • You can contact NEFCU at: 516.561.0030 or at 800.99.NEFCU outside LI/NYC or send an email to info@myNEFCU.org.

How To Apply

Applying for a NEFCU auto loan online requires the same information that an auto loan application at a physical bank would require, you will just be providing the information online. In order to apply, you should have the following information ready:

  • Contact Information: Your address, phone number, Social Security number, email address
  • Personal References: Required in some cases. NEFCU will request them if necessary.
  • Financial/Employment Information: Your employer, gross income and expenses, and monthly debt payments.
  • Vehicle Information: Make, model, year, mileage and VIN of the auto you plan to purchase.

NEFCU allows you to apply for an auto loan online, at a NEFCU branch or by calling their call center. It does not provide online preapproval, but you can obtain preapproval at a branch before shopping.

Coupon Offer

NEFCU offers a $300 coupon valid at select dealers on your new or used auto. You can apply online, at a branch or by telephone by calling 1-800-99-NEFCU. Your rate will be determined by creditworthiness, loan amount, year of the vehicle, and loan term, as per the rate chart.

Everything Automotive Service

NEFCU’s Everything Automotive service allows you to shop for new and used autos, compare different makes and models, take a virtual test drive and schedule in person test drive with different dealerships. Everything Automotive also offers discounted GAP insurance, auto insurance, and extended auto warranties.

This service is accessible only to NEFCU members who apply for auto financing.

The Fine Print

Interest rates on new and used auto loans through NEFCU are based upon vehicle year and loan term, as seen on the rate chart here. The rates shown on the chart are subject to credit approval, and those who do not qualify may be offered a higher interest rate. You will not know your rate until you apply.

Not all borrowers will qualify for an 8-year loan term, and you are required to have and maintain a credit score of 670 or higher in order to qualify for the rates shown in the rate chart.

Used auto loans through NEFCU must not be older than 9 years, but there are no mileage restrictions. There are no restrictions on vehicle make or model, but NEFCU will not finance a purchase of a used auto from a private party seller.

The minimum loan amount for a 6-year term is $15,000, for a 7-year term is $25,000, and $30,000 for an 8-year term. Only new vehicles are eligible for an 8-year loan term, and are eligible for a 100% loan to value ratio.

Pros

  • Rates starting at 1.45%, based on creditworthiness
  • Loans up to $70,000
  • Can apply online, at a branch, or by phone
  • $300 off of your auto purchase at select dealers
  • No prepayment penalties
  • Discounted auto insurance, GAP insurance, and extended warranties through NEFCU
  • No make or mileage restrictions for used auto loans

Cons

  • Rates as high as 13.99%, based on creditworthiness
  • No online preapproval
  • Do not know your rate until you apply
  • Must be a NEFCU member to apply
  • Rate chart can be complicated
  • Minimum $30,000 new auto loan to qualify for 8-year loan term
  • Required to have an maintain a 670 credit score for 8-year loan term
  • Used autos must be 9 years old or newer

How It Stacks Up

Looking for a lower APR? Capital One’s APRs range from 1.99% to 2.49%, and it will finance up to $40,000. Even though its maximum loan amount is lower than NEFCU’s, it offers online preapproval, loan terms of 36 to 72 months, and no origination fee. With rates topping out at 13.99%, NEFCU’s interest rates can be fairly steep, but Capital One is a good alternative.

If you’re looking for the personalized experience of a credit union, but are not eligible to join NEFCU, then consider PenFed Credit Union. Anyone can join PenFed Credit Union with a contribution to one of two designated charitable organizations. Its rates range from 1.49% to 2.99% and it will finance loans up to $100,000. PenFed does not allow you to obtain online preapproval, but it charges no origination fee and offers terms of 12 to 84 months.

Check a Variety of Lenders for Your Auto Loan

Credit Unions are now financing more auto loans than traditional banks because of their more personalized customer experience, more competitive rates, and focus on the customer. When shopping for your auto loan, consider shopping credit unions such as NEFCU for a more flexible, lower interest auto loan.

Compare other auto loans here. 

Gretchen Lindow
Gretchen Lindow |

Gretchen Lindow is a writer at MagnifyMoney. You can email Gretchen at gretchen@magnifymoney.com

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Auto Loan, Reviews

Review: PenFed Credit Union Auto Loan

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

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Trying to find financing for that car you’ve been eyeing, but aren’t sure where to look? You might not want to finance with the dealer, as credit unions offer some of the best loans out there. PenFed Credit Union is no exception with rates starting as low as 1.49% for new cars, and 2.49% for used cars.

PenFed Auto Loan Details

You can finance up to $100,000 with a PenFed credit union auto loan, and you can finance up to 110% of the MSRP on a new vehicle. Be aware there are minimum loan amounts based on the term you finance under.

APRs on new vehicles start at 1.49% for 12 to 36 months, 2.24% for 37 to 48 months, 2.99% for 49 to 60 months, and 3.24% for 61 to 72 months, 3.84 for 73 to 84 months. “New vehicles” are the current and previous model year – you must be the original owner.

On used vehicles, the APR starts at 2.49% for 12 to 36 months, 2.74% for 37 to 48 months, 3.49% 49 to 60 months, and 3.99% for 61 to 72 months. “Used vehicles” are any model years, but the 72 month option is only available for the current and previous two model years. PenFed uses the National Automobile Dealers Association (NADA) value to determine the maximum amount of financing available, as financing on used vehicles can’t exceed 110% of the NADA average retail value.

Unfortunately, there’s no APR range – a representative we spoke with said a maximum APR doesn’t exist. Loan officers haven’t seen rates exceed 5 – 6%.

A payment example looks like this: if you finance a new car for $20,000 on a 36 month term at 1.49% APR, your monthly payment will be $568.41. If you finance a used car for $20,000 on a 36 month term with an APR of 1.99%, your monthly payment will be $572.76.

How to Apply for an Auto Loan With PenFed

PenFed provides preapproved auto drafts for qualified borrowers (you need to have a good credit score), and you may get an instant decision after applying. Otherwise, applications are typically processed within 24 hours on business days.

You need to be a member of PenFed before you apply for a loan, so you’ll have to create an account if you’re interested. See below for membership eligibility.

The application can be filled out online or you can apply by speaking with a member representative over the phone.

Having a credit score of 700 or above will get you the best rates, which are listed above. If your credit score is below 700, PenFed can still process the loan, but it will go through LendPro. LendPro doesn’t offer preapprovals as it needs the vehicle information to process the application.

Documents and Information Needed to Apply

PenFed needs borrowers to provide their contact information, vehicle information, income and expenses, and employment information and salary to apply.

For vehicle information, make sure you know the exact make and model, year, and have the VIN.

The Fine Print

There is no origination fee associated with this loan. Rates are determined based on your credit and how much you’re looking to finance. For example, if you’re looking to finance $25,000 and the vehicle costs $25,000, your rate will be higher than someone who is only financing $15,000 for a $25,000 vehicle.

Pros and Cons of PenFed’s Auto Loan

Pro: After making 12 payments, you might qualify to extend your loan, which lowers your monthly payment. While we don’t recommend doing this unless you’ve hit a rough financial spot, it’s good to have the option available.

Con: It’s a little difficult to figure out how to contact PenFed if you have a question (and aren’t a customer). On the auto loan page, there’s a link to apply for the loan, but no phone number is listed. You can call the main customer service line to get assistance.

Pro: APRs aren’t very high when compared with other lenders, such as Navy Federal Credit Union. Even the “max” of 5 – 6% is fairly low.

Con: Those that have a credit score under 700 have less of a chance of being approved for financing. PenFed typically targets consumers with excellent credit.

Con: As with any credit union, you need to be a member before applying. Opening another account just to get access to this auto loan might not appeal to you.

Membership Requirements for PenFed

There are several ways you can become a member of PenFed Credit Union. If you’re a member of the United States military or Uniformed Services, work for the U.S. government, or are related to someone who is, you’re eligible to join.

If you’re not eligible through those avenues, you can still join by donating $14 toward Voices for America’s Troops or $15 toward the National Military Family Association. These are two charities PenFed supports, and all money goes directly to them.

Lastly, if you’re creating a new PenFed account, you’ll be required to make a $5 deposit in a Share Account to represent your ownership in PenFed.

Penfed

Other Auto Loan Alternatives

Credit unions offer some of the best auto loans, but if you don’t qualify for membership with PenFed and don’t want to make a donation, you should look at your local credit unions. Most require that you live or work in the area to be eligible for membership. Otherwise, you can check out these alternatives:

LendingTree: There are hundreds of lenders on LendingTree, our parent company, ready to compete for your business. You just have to fill out a short online form, which LendingTree may use to try to match you with lenders. If you receive a lender match, you may then see real interest rates and approval information. Some lenders will do a hard pull on your credit. Keep in mind that multiple hard pulls only count as one pull, so it is smart to have all your hard pulls done at once.

 

LendingTree

LEARN MORE  

Capital One: If you’re looking to finance a vehicle under $40,000, Capital One offers terms of 36 to 72 months, with APRs starting at 1.99% to 2.49% for new cars, and 2.89% to 3.39% for used cars. This is similar to PenFed, and Capital One offers online preapproval.

Capital One

LightStream: You can finance up to $100,000 on terms of 24 to 84 months. APRs on new cars range from 1.74% to 5.69%, and APRs on used cars range from 1.74% to 6.54 %. LightStream offers online preapproval as well.

LightStream

Neither lender charges an origination fee.

Be Sure to Shop Around

With so many options available, it would be foolish not to shop around and find the best auto loan for you. You can apply online with most lenders and receive an answer back within one to two days. As long as you apply to multiple lenders within a 30-day period, your credit won’t take a huge hit. This is because all inquiries made within that time period count as one inquiry. Take advantage and find the auto loan that will cost you the least.

Compare Auto Loan Offers Here.

Erin Millard
Erin Millard |

Erin Millard is a writer at MagnifyMoney. You can email Erin at erinm@magnifymoney.com

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Auto Loan, Reviews

Review: Capital One Auto Loan

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Car_lg

The smartest way to buy a new car is by walking into the dealership with preapproved financing already in hand – and online auto financing is making the process easier than ever. This gives you the upper hand when negotiating the price of the car you purchase, and eliminates the stress of applying for financing at the dealership.

The dealership, though, will not be happy that you walked in already pre approved, because dealerships make most of their money on financing. Most likely they will try to beat your financing with a more attractive APR.

The Offer

Capital One auto loan APRs start at 3.24% with no origination fee and financing up to $40,000. Capital One offers online pre approval to make car shopping easier.

How To Apply

To apply for preapproval, you will need proof of your residence, phone number, Social Security number and email address, as well as your employment and income information. In some cases, you may be required to provide personal references.

After you are preapproved, you can take your offer to any one of 12,000 eligible dealers and shop for new or used cars. Once you have a few vehicles in mind, you’ll be able to go to Capital One’s website and input the vehicles you are thinking about purchasing and see the specific amount you are approved to finance for that specific vehicle.

You will have 45 days to use your pre approved auto loan offer before it expires. If you let your pre approval offer expire, you will be required to re-apply.

The Fine Print

Pre approval through Capital One is valid at its 12,000 eligible dealers. To find the dealers nearest to you, check here. Capital One does not finance purchases from auto brokers or private parties.

Once you’re ready to complete your purchase, the dealer will require you to sign their credit application so that they can provide you with the legally required financing disclosures. This will typically result in a credit inquiry from the dealership. You will also be required to sign a contract with the dealer disclosing your purchase and financing terms.

Vehicles financed through Capital One must be 9 years old or newer and have less than 100,000 miles. It does not finance Oldsmobile, Daewoo, Saab, Suzuki, or Isuzu vehicles. It also does not finance recreational or commercial vehicles such as limousines, motor homes, ATVs, or boats.

Capital One requires a loan-to-value ratio of 90% or less for new vehicles, so you may be required to make a down payment on your new auto purchase.

Pros

  • APRs range from 3.24% to 4.14%
  • 36 to 72 month terms
  • No origination fee
  • Online pre approval
  • Loans up to $40,000
  • No prepayment penalties

Cons

  • Financing only valid at eligible dealers
  • 90% Loan-To-Value Ratio required for new vehicle purchases
  • No financing for commercial or recreational vehicles
  • No financing for purchases through private parties or auto brokers

How It Stacks Up

LendingTree

With LendingTree, you can fill out one short online form and see real interest rates and approval information at once. There are hundreds of lenders on LendingTree ready to compete for your business. Some lenders will do a hard pull on your credit and this is normal within the auto lending space. Keep in mind that multiple hard pulls will only count as one pull, so it is smart to have all your hard pulls done at one time.

Disclosure: LendingTree is the parent company of MagnifyMoney.

LendingTree

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LightStream

If you’re looking to purchase a vehicle more than $40,000, then consider LightStream. It offers financing up to $100,000, APRs starting at 1.74%, and terms of 24 to 84 months. You can obtain online preapproval through LightStream and it charges no origination fee.

PenFed

PenFed is also an excellent alternative with rates starting a bit lower, at 1.49%. APRs top out at 2.99%, loan terms range from 12 to 84 months, and PenFed can finance up to $100,000. PenFed charges no origination fee, but does not offer online preapproval. However, you need to join the PenFed Credit Union in order to be eligible.

Be Sure to Shop Around

Shopping for a new car can be a stressful experience. After all, dealing with variables such as financing approval, determining which car to purchase, and then negotiating the price of that car can make for a long and sometimes complicated process.

But walking into a dealership with financing already in hand gives you an advantage – and gives the dealership the opportunity to beat your finance with a lower or 0% APR financing option – and you can feel good about the savings that comes from that competition.

Compare Auto Loan Offers Here.

Gretchen Lindow
Gretchen Lindow |

Gretchen Lindow is a writer at MagnifyMoney. You can email Gretchen at gretchen@magnifymoney.com

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Auto Loan, Best of, Reviews

The 6 Best Auto Loans for a New Car

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

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Shopping for a new car involves a lot of moving parts.

How much can you spend on a new car? What type of car do you want? Are you getting a good deal? Will you be able to obtain financing? Will your auto loan have a good interest rate?

While all of these variables often make car shopping stressful, there are a couple of things you can do to simplify the process.

First, evaluate exactly how much you can afford to spend on a new car. Look at your budget and determine the absolute maximum you can afford to pay monthly. Also be aware of your total debt payments when compared to your income. Generally speaking, the total of all your debt payments – auto loans, student loans and mortgage – should not exceed 50% of your income. Make sure to factor your new auto payment into the calculation.

Next, shop online for the best new auto loan rates and get preapproved for the most attractive offer for which you are eligible. In order to strike the best deal possible on your new car, you should walk into the dealership with financing already taken in place.

Once you get to the dealership and find the car you want, negotiate the price of the car before telling the salesperson that you are approved for financing. Be prepared with information from sites such as TrueCar to back up your negotiation.

After you have come to an agreement about the price of the new vehicle, show the dealer that you are preapproved, and ask the dealership to beat your rate. Often, auto manufacturers offer 0% financing, especially to those with excellent credit. Even if the dealership isn’t able to beat your preapproved financing, at least you know you can proceed with the purchase.

[Borrow Before You Buy a Car]

How To Apply

When shopping online for a new auto loan, the application process is very similar to that of a brick-and-mortar bank, but more streamlined. In general, be prepared with:

  • Your contact information: Name, address, phone number, email address
  • Vehicle information (if known – required for lenders that do not offer online pre approval)
  • Financial Information: employment information, gross income and expenses

The Best Auto Loans for a New Car

LendingTree

With LendingTree, you can fill out one short online form and there are hundreds of lenders ready to compete for your business. Upon completing the application, you can see real interest rates and approval information instantly. Some auto lenders will do a hard pull on your credit and this is common with auto lending. It’s important to remember, multiple hard pulls will only count as one pull, so the best strategy is to have all your hard pulls done at one time.

Disclosure: LendingTree is the parent company of MagnifyMoney.

 

LendingTree

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LightStream

LightStream offers online auto loans with APRs starting at 2.29%. It’s terms range from 24 to 84 months. LightStream can finance up to $100,000 and charges no origination fee. It does offer the ability to obtain pre approval online, before setting foot in a dealership, and if you are approved, you could receive funds into your bank account in as little as one business day.

The 2.29% APR is dependent upon enrolling in AutoPay. If you choose to not to enroll in AutoPay, your rate will be 0.50% higher, starting at 2.79%. While rates from LightStream start at 2.29%, they do depend upon the amount financed.

Because LightStream offers no telephone customer support, it offers a guarantee that you will love its service, from start to finish. If you aren’t completely satisfied with your experience, $100 will be deposited into your account, provided you fill out a questionnaire about your experience within 30 days of closing on your loan.

PenFed

PenFed Credit Union offers rates from 1.49% to 2.74% on new auto loans up to $100,000. It will finance terms of 36 to 72 months, and vehicles up to $100,000 with no origination fee. Rates are dependent upon the amount financed, and the terms financed for, as shown in the chart below:

PenFed-Chart (1)

Because PenFed is a credit union, you will need to join in order to apply for an auto loan through it, but anyone can join with a one-time donation of $14 or $15 to a PenFed approved charity supporting the troops. Also important to note is that even though the loan is entirely online, PenFed does not offer online pre approval.

Capital One

Capital One offers auto loans with rates ranging from 1.99% to 2.49% and terms from 36 to 72 months. It can finance up to $40,000, and has no origination fee. Capital One also offers online pre approval. You do need to find eligible dealers before walking onto a car lot with your offer. You can do that here.

Rates are dependent upon the financing terms, as seen in the chart below:

CapOne-Chart (1)

NEFCU

NEFCU is a credit union offering auto loan rates ranging from 1.45% to 13.99%. It can finance up to $70,000 for 12 to 96 months with no origination fee. NEFCU does not offer online pre approval.

NEFCU offers a $300 coupon offer valid at select dealers on your new or used auto.   You can apply online, at a branch or by telephone by calling 1-800-99-NEFCU. Your rate will be determined by creditworthiness, loan amount, year of the vehicle, and loan term, as per the rate chart.

In order to apply for an auto loan from NEFCU, you must be a member. You are eligible for membership with NEFCU if you:

  • Live in Nassau and/or Suffolk Counties
  • Work in Nassau and/or Suffolk Counties
  • Worship in Nassau and/or Suffolk Counties
  • Attend school in Nassau and/or Suffolk Counties
  • Regularly conduct business in Nassau and/or Suffolk Counties
  • Family Sponsorship – An existing NEFCU member can sponsor in an immediate family member (mother/father, brother/sister, child, grandparent or grandchild) or any household member
  • Membership is not open to individuals who live, work, worship, attend school and do business exclusively in East Hampton, Southampton and Shelter Island.
  • If you have any questions on membership or eligibility, please contact us at 516.561.0030 or at 800.99.NEFCU outside LI/NYC or send an email to info@myNEFCU.org.

Navy Federal Credit Union

Navy Federal Credit Union offers new car loans with rates ranging from 1.49% to 17.99% with terms of 12 to 96 months. It can loan up to $500,000 and charges no origination fee. Navy Federal Credit Union does offer online pre approval.

Rates from Navy Federal Credit Union are determined by the car’s model year, as well as the loan term, as seen in the chart below:

NavyFedChart

In the rate chart, new vehicles are year models 2014, 2015, and 2016 with 7,499 miles or less, and the minimum loan amount is $30,000 for terms 85-96 months. Late model used vehicles are described as 2014, 2015, or 2016 models with 7,500 – 30,000 miles. Used vehicles are any vehicle with 30,001 miles or more.

In order to apply for an auto loan from Navy Federal Credit Union, you must become a member. You are eligible if you are Active Duty Army, Navy, Marines, Air Force, Coast Guard, Army or Air National Guard, a member of the Delayed Entry Program, a DoD Officer Candidate/ROTC, a DoD Reservist, or a retiree from any of these service branches. You are also eligible as a civilian if you are a DoD civilian employee, a U.S. government employee assigned to a DoD installation, a DoD contractor, or a DoD retiree. Finally, if you are the immediate family member of anyone eligible to join, you are also eligible to become a member.

Shop Around for the Best Rate

When searching for your auto loan, don’t worry about how multiple credit inquiries will affect your credit score. All inquiries within a 30-day period count as one inquiry, so as long as you do your entire rate shopping within a 30-day period, the inquiries will have only a minimal impact on your credit score.

Even if you walk into the dealership with financing in hand, remember not to mention it until you have successfully negotiated the price of your car. Then, when you do tell the dealership that you already have financing, don’t be surprised if they try to beat it.

Gretchen Lindow
Gretchen Lindow |

Gretchen Lindow is a writer at MagnifyMoney. You can email Gretchen at gretchen@magnifymoney.com

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