How Easy is it to Get a Car Loan from a Credit Union?
The first question someone has when they start to search for a new car is what kind of car to buy. When deciding the best car for you and your loved ones, it is important to research different car manufacturers, determine if you want a new or used vehicle, and consider the maximum cost you are willing to pay for features. After deciding on the best car to buy, the next step is determining how to finance the vehicle.
Trying to determine how to finance a car can be a stressful and lengthy process. Financing has a long-term impact on this one-time purchase because of interest rates, the lengths of loans, and your ability to secure a loan. Considering these hurdles, you should know where to look for the rates, leniency, and terms you want before your vehicle purchase. One way to get the professional and reliable help you need to finance a vehicle is by consulting a credit union. A credit union is a financial institution that functions similar to a bank, but it is a not-for-profit institution. Instead of being run by shareholders, credit unions are owned by people who have something in common, such as employment or community.
Why Choose a Credit Union?
As a not-for-profit financial cooperative, credit unions offer lower costs to each member, which is often more affordable than a typical bank or auto dealer loan. In comparison to the industry average, lending rates with credit unions are 21% percent lower while big banks exceed the same average by 10 percent and regional based banks are even higher at 25 percent more. Partnering with our credit union can also be helpful for people who can’t obtain the loan they want from a traditional bank or if the loan they want from a traditional bank has unfavorable terms.
Some credit unions are lenient to people within their membership, which decreases the difficulty of obtaining a loan. Even if your credit is not very good, you may receive a reasonable loan with fewer restrictions as a credit union member. Borrowing from a credit union may also help you build credit in the first place. These institutions can be helpful when you need loan terms that many traditional banks are not willing to give. Credit unions work harder to make sure their members get what they need for financing they can afford.
Credit Union Auto Loans - What Do I Need to Know?
Although it can be easier to get an auto loan through a credit union, the application process looks similar to that of a traditional bank. A credit union is not-for-profit, but their resources must be used with discretion because the money comes from their members. Credit unions will still examine conditions such as:
- Employment length
- Ratio of debt to income
- Credit score
- Size of the loan
- Credit history
- Size of down payment
These factors are used to craft a financing option to best serve the member. Requirements vary at different credit unions, but they can offer loans in more cases than most banks.
There are also ways you can lower your rate. Removing other debts, especially those with higher interest rates, can make the difference in getting the best possible rate. If you stick to a budget for a few months before your car purchase, you can save more towards your down payment, which will also improve your rate and loan terms. If you’re considering a career change, it may be better to wait until after your loan is approved to ensure your employment history appears more consistent and reliable.
Partner With Del Norte Credit Union
If you’re ready to start your application, contact Del Norte Credit Union today. If you’re not a member, you can obtain membership and apply for a loan on the same day. Find out how quickly you will qualify and what loan terms we can offer you.
Apply for a DNCU vehicle loan to finance a new or used car, truck, or motorcycle.