how to get a car loan

How to Get a Car Loan

Simple Steps for a Successful Borrowing Experience

Getting approved for an auto loan is a multi-step process. The good news: Greater Nevada Credit Union is here to help you navigate it with tips, resources, and personalized help. Learn how to get a car loan (and get the one that’s right for your lifestyle) today!

How to Get a Car Loan from a Credit Union

Not sure where to begin when it comes to car loans? You’re in good company. Thankfully, when you team up with Greater Nevada, you’re never alone in the application process. We believe it should be simple–and we believe it begins with getting informed.

Whether you’re buying your first or fifth vehicle, it’s important to do your research on an auto loan to fund your purchase. We’ve created this handy guide to help show you the way, no matter if you’re a first-time car buyer or simply looking to refinance your loan.

Take some time to assess your finances. Get a feel for what kind of monthly payment would be comfortable alongside your current expenses. But keep in mind: that monthly payment isn’t the only new expense that comes with owning a car. You’ll also need to consider things like…

  • Annual DMV registration
  • Monthly insurance payments
  • Regular vehicle maintenance
  • Gas

As with any loan, it’s most important to determine whether you’ll be able to consistently make on-time payments. You may be pre-approved for a larger loan amount than the purchase price of the car you have in mind–and larger loan amounts generally come with higher monthly payments. If you can’t afford higher payments, it’s a good idea to not use all the money you’re cleared to borrow.

Your credit score is a key deciding factor when it comes to getting approved for an auto loan. Financial institutions use your credit history to determine your loan’s interest rate, as well as the total loan amount. For example, a lower credit score may prevent you from borrowing as much money as you need to buy the vehicle you have in mind. You may also wind up with a higher interest rate (and higher monthly payments).

We recommend checking your credit score three to six months before you try to purchase a vehicle. My Credit Health, available within Greater Nevada Digital Banking, is free to all members offering a powerful one-stop-shop to access your credit score, credit monitoring, credit score simulator, financial tips, and more. All of this without impacting your credit score, and all online.

Get a sneak peek at your projected loan terms by applying for pre-approval. Pre-approval is a great way to expedite your application, as well check what kind of auto loan rates and total amounts you’re likely to receive. Getting pre-approved for a loan can give you more bargaining power with dealerships, and could save you the hassle of having to check out many different auto lenders if you are comfortable with the initial rate you’re pre-approved for.

You know how much you can afford. You know how much you’re approved for. All that’s left is the fun part: deciding what kind of car to buy. Using our free AutoSMART tool can help make shopping easier, with features for comparing important details and connecting you to local dealers.

Before you go shopping, we recommend checking your car loan requirements. Sometimes certain manufacturers or car types are excluded. For example, some lenders don’t allow borrowers to buy electric vehicles with their loans. This is also a good time to check for dealership requirements, where the lender may require that you purchase from a certain network of car dealers.

As you near the end of the application process, here are some key facts to consider about terms, repayment, and fees.

  • Your lender technically owns your vehicle and will be noted as the lienholder on the title until you’ve paid your loan in full.
  • Offering a larger down payment usually means lower monthly payments and less interest paid over the life of your loan.
  • Be prepared to pay registration fees when you purchase your vehicle. If buying from a car dealership instead of a private party, then you’ll also need to be prepared to pay sales tax and any fees they charge (like a destination fee to transport your new car from another location as an example).

Once your application is finalized, it’s time to start driving–and start making payments. Making your monthly payments on-time is essential, especially for your credit score. A strong credit score will help you get approved for other loans (not just auto, but personal and home loans, too).

Failing to make payments, or making late payments, can negatively impact your credit score. Late payments stay on your credit report for seven years. If you miss several payments, your lender may turn your debt over to a collection agency or even repossess your vehicle. Setting up automatic payments can help ensure you’re always on-time, even when life gets busy.

Benefits of Getting a Car Loan from a Credit Union

Greater Nevada Credit Union is on your side when you’re ready to purchase a car. Instead of haggling with a dealership or settling for average rates at a bank, explore what’s possible with credit union car loans. Members of credit unions often enjoy better interest rates and terms on loans–not just with cars, but with homes, personal loans, and others.

  • 1) Low-Interest Rates & Lower Fees

    Unlike banks and car dealerships, credit unions are not-for-profit organizations that prioritize members rather than shareholders. This lets us offer a lower interest rate on loans than traditional banks and car dealerships.

  • 3) Higher Likelihood of Approval

    At other financial institutions, a bad credit score might mean getting turned away automatically. But when you’re a member of Greater Nevada, you’re a member of our community. That means we’ll work with you to achieve your financial goals by leaving no stone unturned to see if a solution is possible.

  • 4) Lower Loan Minimums

    Supporting members, rather than shareholders, means our credit union can offer favorable terms, which include low loan minimums if you’re bringing a large down payment to the table.

  • 5) Strong Community Involvement & More Personalized Service

    Greater Nevada Credit Union is made up of your friends, family, and neighbors. These community ties are what make us strong–and they’re what drive us to share our returns with others.

    Every year, our annual scholarship program awards $2,000 in scholarships to 30 qualifying individuals. Our Carson High Education Branch helps students get real-world job experience, earn class credits, and learn more about managing money. We also partner with the University of Nevada, Reno, and Western Nevada College on many community initiatives.

    As a member, you’ll support these educational endeavors just by banking with us. In return, you’ll gain access to member-exclusive resources, offers, and service to help you Live Greater every day.

Car Loan Frequently Asked Questions (FAQs)

From APR to applications and everything between, applying for a car loan can be complicated. We’re here to help. Check out the answers to common questions we’ve received below.

What is an annual percentage rate (APR)?

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APR is expressed as a percentage and represents the cost you pay each year to borrow when factoring in the interest rate on the amount borrowed with any fees that will be included in the financing of your vehicle loan (and other loans, including personal and mortgages). It’s primarily influenced by your credit score and down payment amount.

If you have a lower credit score, or make a smaller down payment, your APR will likely be higher, and you’ll pay more interest over the life of the loan. Similarly, having good credit and making a larger down payment can save you money in the long run.

What is a loan term?

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Put simply, your loan’s term describes the repayment period–typically month by month. A long loan term might mean lower payments, but you’ll almost always pay more interest on the whole. A short loan term might mean higher payments, but you’ll save overall by paying less interest.

What credit score do I need for a Greater Nevada car loan?

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Having a healthy credit score is one of the most important criteria for securing an auto loan. But if your credit isn’t great, it doesn’t have to be a dealbreaker. At Greater Nevada, we try not to turn away applicants for having imperfect credit scores. Instead, we look at a variety of things (like your credit history, collateral and if a co-borrower is involved to only name a few) to find solutions and a way forward.

How much of a down payment should I make?

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It depends on your financial situation, but generally speaking, it’s a good idea to put down at least 20% on your prospective vehicle. That’s the threshold that can help protect you from depreciation and decrease your risk for owing more than the vehicle is worth–or being “upside down” on your auto loan.

getting a car loan from a credit union

Apply for an Auto Loan Today

Now that you’re up to speed on all things auto loans, apply with confidence. Go online or give us a call to start your application (or get pre-approved).

Compare Car Loans from Greater Nevada Credit Union

As a credit union, our reason for being is based on helping more people Live Greater. One of the ways we do this is by offering products that promote financial wellness via lower monthly payments, better interest rates, flexible terms, or all of the above. Below, you’ll find a few important details about different types of car loans available through our financial cooperative.

Additional Resources