How Are Car Loan Rates in Covington, LA Calculated?
A handful of factors impact your Louisiana car loan rate, Including your credit score, your income, the amount of the loan, the down payment, your loan's term (the length of the loan), and the car's age. A high debt-to-income ratio, low credit score, or purchasing an older car from a dealer in Covington could lead to a higher interest rate. But what's so bad about a high interest rate? The higher your interest rate gets, the higher your monthly payment becomes and the more you spend over the life of your loan. A difference of one or two percent might not seem like much, but it could mean spending hundreds more on interest.
How Do I Get a Lower Car Loan Interest in Covington, LA?
Online tools like our Interest Rate Estimator will give you a feel for what your rate might look like before you start applying for auto loans in Covington, LA. If you've supplied your information and aren't liking the percentage you see, what steps can you take to lower it?
The loan term is one element you can change on your own. Most Covington auto loans are available with terms in 12-month increments between 2 years (24 months) and 7 years (84 months). Longer terms attract many borrowers because they typically have a lower monthly payment. But longer terms are also likely to come with higher interest rates. If you can afford a higher monthly payment, it's better to choose a shorter term. The Auto Payment Calculator shows your possible monthly payment based on different interest rates and terms to help you see what might be affordable.
If your credit is far from great, raising your score could decrease your interest rate. Our Guide to Better Credit for Auto Financing walks you through what determines your credit score and the steps you can take now to raise it quickly. It may take some effort and time to increase your credit score, but it's all worth it for getting those lower auto loan rates in Louisiana.
Taking some time to find the right lender can also help you achieve a lower rate. While lenders will look at the same information, you'll likely receive a different interest rate from each one. Shopping around and comparing offers will help you find the best auto loan rate in Covington, LA — even without a high income or credit score. You shouldn't go with the first offer you receive because there could be a better one right around the corner. Plus, some lenders are open to negotiation, so you can take your offer from one lender to another to see if they're willing to give an even lower rate.
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