Choosing and buying a car is exciting, especially if it’s something you’ve dreamed about for a long time. When it comes to financing your big purchase, you have several options available to you, such as traditional bank lenders and the dealership you purchase your car from. However, don’t forget to consider the substantial benefits of a credit union car loan.
Credit unions like Capital Credit Union provide many unique advantages over traditional lenders. They can help you save money, offer you unique plans and programs, and help you get approved for a loan faster—even if you’re a first-time car buyer or don’t have a perfect credit score.
Let’s take a look at a few of the benefits of getting an auto loan with a credit union.
Lower Interest RatesCars can be expensive, and the interest can really add up over time. You don’t want to pay more in interest than you have to. That’s why one of the most significant advantages of obtaining a car loan through a credit union is the often-lower interest rates. As credit unions are not-for-profit financial institutions, they can offer more competitive rates than traditional banks and other lenders.
Credit unions are member-focused. Their main goal is to provide the members of their communities with better financial solutions, such as lower interest rates and fees on loans, and give people a head start on reaching their financial goals.
Flexible Loan TermsCredit unions typically offer more flexibility with their loan terms than other lenders, allowing you to choose the option that fits your needs best. You’ll be able to choose the length of your loan, which can help you find the right payment schedule for your budget.
Since interest rates and loan terms can change regularly, view the current rates online or speak with your credit union to learn more.
Easier Loan Approval ProcessesApplying for a loan can be daunting when you have less-than-perfect credit. Some lenders may not loan money to you if you have little to no credit built up.
Fortunately, credit unions often have more lenient eligibility requirements than banks and other lenders. This can be a huge benefit if your credit score isn’t perfect and you’ve had difficulty obtaining financing through other lenders.
Applying for a loan at a credit union is easy and can typically be done online or by scheduling an in-person appointment. Not a member yet? Don’t worry. Joining a credit union such as Capital CU is easy too.
First-Time Auto Buyer ProgramBuying your first car is an exciting milestone but also a huge financial step. You may not know where to start, especially if you’ve never taken out a loan before. A credit union is not only a great lender but also a great resource.
Credit unions are member-centered and dedicated to providing borrowers with the tools and information they need for all their financial moves. Many credit unions offer car-buying programs and competitive terms that benefit first-time car buyers.
For instance, Capital Credit Union’s First-Time Auto Buyer program offers a loan designed for people with little to no credit who are looking to purchase their first car. We offer up to 100 percent financing and maximum terms of 60 months. Plus, taking out a First-Time Auto Buyer loan and making regular monthly payments is a great way to start establishing good credit for big purchases in the future.
Car-Finder ProgramsOne of the reasons buyers sometimes choose dealership loans is the convenience: they can shop and borrow all in one go. The downside of this option, as we’ve mentioned, is that the rates for those loans tend to be higher and the terms less flexible.
An alternative is to work with a credit union that partners with local dealerships to offer a car-finder program. Borrowers receive the competitive rates and terms and other benefits of a credit union auto loan and gain access to the tools they need to find a great vehicle.
Try the Capital CarFinder tool. It’s the perfect way to search for your new vehicle. You’ll be able to search dealership inventories throughout northeast Wisconsin in one convenient place. Once signing up, you’ll also be able to access free CarFax reports, calculate your car loan payment, and contact the dealership to learn more about a car you’re interested in.
Extra ProtectionSometimes, the unexpected happens, even if you’re a careful driver. That’s why credit unions provide you with extra protection on your new vehicle.
Some protection options include:
- Guaranteed Asset Protection: If your car is totaled or stolen but you owe more on the loan than insurance will pay, Guaranteed Asset Protection coverage will pay the rest of the loan.
- Auto Deductible Reimbursement: This type of program pays you a set dollar amount per loss when a covered claim exceeds your insurance deductible.
- Mechanical Breakdown Protection: Unexpected vehicle repairs can be a headache. Luckily, extended warranty programs provide you with benefits such as nationwide coverage and roadside assistance should a mechanical breakdown occur.
- Debt Protection: The last thing you want is for your loan balance to become a burden or drag down your credit rating.
Capital CU offers each of these protections with its auto loans.
Free Financial Education ToolsThe benefits of going with a credit union go far beyond lower interest rates and potential savings. Credit union members have access to a host of free financial education tools that can help make you a smarter saver and spender.
Buying a car is a huge step on your financial journey. It could even be one of the biggest purchases you’ll ever make. A credit union can empower you to make smart decisions with money and understand the car loan you’re taking out.
At Capital CU, check out free online classes to learn about topics like healthy financial habits, how to pay off debt, how to manage loans, how to create a budget to achieve your financial goals, and more. Our blog is also full of resources to help educate you about personal finance.
Personalized Customer ServiceWhen you interact with large lenders, it can feel like you’re just another number in their system. But at a credit union, you’ll get more personalized customer service and individualized attention throughout your loan process.
Credit unions pride themselves on building positive relationships with their communities. Credit unions like Capital CU are owned by members, which allows us to offer you better interest rates, more flexible terms, and valuable educational tools to help you understand your car loan.
