When shopping for a car, there are a lot of things to think about. Aside from the actual vehicle – make, model, trim, etc. – you also need to consider the purchasing part.
If you plan to finance, it’s important to know what this entails, and one key area involves the loan term.
What Is a Loan Term?
When you apply for a loan through our Honda financial service center, you’ll be asked several things, including how much you want to borrow and the money you have for a down payment.
You’ll also need to think about the loan term, which is the length of the loan. When you want to have the loan completely paid off is basically up to you and your budget. It can be as short as 12 months or as long as 84 months. It also depends on how much you put down and your APR.
If, for example, you have a Honda Accord you want to trade in that’s still in good condition, its trade-in value can be used for a down payment. As a result, you may not need to borrow as much, which means you can have a shorter loan term.
One of the big benefits of going with a shorter term is that this generally means your interest rate will be lower. Conversely, a longer loan term results in lower monthly payments.
Check out our Payment Calculator to play around with different loan terms, interest rates, and car prices to create a payment plan you can afford.
Finance Questions? Get in Touch!
We understand that financing can be confusing, which is why our Westminster dealership aims to make the process as simple as possible. Contact us with any concerns or questions you may have. Be sure to also take a look at our current Honda finance specials.
