FAQs
Though you can take out loans from banks or online lenders, an auto loan from a credit union is your best bet for getting the right terms for your needs. Plus, they work essentially the same way, so there won't be any surprises when it comes to borrowing or paying it back.
What would be some cons of buying a used vehicle from a dealership? ›
Disadvantages of Buying a Used Car
- A lot of unknowns.
- More wear and tear.
- Fewer customization options.
- Most don't come with warranties.
- Higher mileage.
- Possibility of being stuck with a lemon.
What is better a credit union or a bank pros and cons? ›
The Bottom Line. Credit unions can be ideal for a low-interest loan, lower mortgage closing costs, or reduced fees, but you'll need to qualify for membership. Larger banks may offer you more choices regarding products, apps, and international or commercial products and services, and anyone can join.
What is a disadvantage to using a credit union? ›
Limited accessibility. Credit unions tend to have fewer branches than traditional banks. A credit union may not be close to where you live or work, which could be a problem unless your credit union is part of a shared branch network and/or a large ATM network such as Allpoint or MoneyPass.
What is a good APR for a car? ›
Generally, a good APR for a car loan might look something like this: Excellent Credit (750+): 3% or lower for new cars, 4% or lower for used cars. Good Credit (700-749): 4-5% for new cars, 5-6% for used cars. Fair Credit (650-699): 6-7% for new cars, 7-8% for used cars.
What credit score do credit unions use for auto loans? ›
Most lenders use FICO, which ranges from 300 to 850. VantageScore is less common but still ranges from 300 to 850. Both scores use a mix of your credit history, amount owed, balances and available credit — just weighted differently. Some auto lenders also use a version of the FICO score called FICO Auto Score.
What not to say at a used car dealership? ›
Let's look at some things to keep under your hat while you explore the lot.
- "I Don't Know Much About Cars"
- "My Current Car Is on Its Last Legs"
- "My Lease Is Almost Up"
- "I'm Going to Pay Cash!"
- "I Already Have a Car Loan Lined Up"
- "I Love This Car"
- "I've Never Bought a New Car Before"
How do I avoid getting scammed when buying a used car? ›
Fortunately, there are a few steps you can take to weed out most scams:
- Ask for a vehicle history report. Many private sellers will order one to make things easier for potential buyers. ...
- Hire a mechanic. ...
- Verify the seller's story. ...
- Pay with a cashier's check.
How do you not get taken advantage of buying a used car? ›
Never go to a dealership acting rushed, even if you need a car immediately—they'll take advantage of it. Many salespeople say they won't pressure or rush you into buying, but they usually do it anyway. If you feel the sales process is moving too fast, tell the salesperson that you'll come back at another time.
Why do banks not like credit unions? ›
For decades, bankers have objected to the tax breaks and sponsor subsidies enjoyed by credit unions and not available to banks. Because such challenges haven't slowed down the growth of credit unions, banks continue to look for other reasons to allege unfair competition.
One question that often arises is, "Are Credit Unions Safer than Banks?" If you're looking for a short answer, you'll be happy to know that we're not making you read the whole post: Credit Unions and banks are roughly identical in safety because deposits at both are insured by the Federal government to $250,000.
What is the best credit union to join? ›
Best Credit Unions of September 2024
- Members 1st Federal Credit Union: Best for Overdraft Protection.
- Connexus Credit Union: Best for Checking Accounts.
- Bethpage Federal Credit Union: Best for Savings Accounts.
- Lake Michigan Credit Union: Best for Interest Rates.
- Alliant Credit Union: Best for Digital Banking.
Why is it better to finance a car with a credit union? ›
Fewer requirements: Once you are a member of a credit union, it can be easier to get a car loan than from a traditional bank, especially if you have a poor credit score. More flexible terms: Credit unions can be more flexible than banks when it comes to repayment terms and tend to charge lower fees.
What is the difference between a credit union and a federal credit union? ›
Credit Unions are the only democratically run financial institution. A federal credit union is member-owned and controlled. Member's interests are represented by a volunteer board of directors drawn from the membership and elected by the membership.
Can a credit union fail like a bank? ›
Like banks, credit unions can fail, but their failure is far less common and the financial fallout is mild by comparison. In 2023, for example, five bank failures represented a total of $549 billion in assets, and the First Republic Bank closure in 2024 impacted $6 billion alone.
Is it easier to get a loan from a credit union than a bank? ›
Most credit unions, including the Credit Union of Southern California (CU SoCal), have more flexible lending requirements than traditional banks. This is because credit unions are member owned and non-profit, and can offer quick approvals and competitive rates that are lower than bank rates.
Is it harder to get car loan from bank? ›
Americans are having a harder time getting approved for auto loans, as banks worry over the risk of defaults at a time when high interest rates and elevated car prices are squeezing budgets. With borrowers struggling to make their monthly car payments, banks are responding by tightening credit standards.
Are credit unions more likely to give you a loan? ›
Because of their nonprofit nature, a credit union may be more willing to accept riskier borrowers or offer better borrowing terms than banks and finance companies can. Each credit union sets its own lending criteria and determines the interest rates and fees it charges, within legal limits.
What credit union is the best for car loans? ›
Compare the Best Auto Loan Lenders
Company | Used APR Range | Used Loan Terms |
---|
PenFed Best Overall | 6.49%–17.99% | 3–7 years |
AUTOPAY Best for Bad Credit/Low Rates | As low as 5.69% | 2–8 years |
Consumers Credit Union Best Credit Union | As low as 6.84% | 36–84 months |
LendingTree Best for Refinance | As low as 5.99% (Refinance) | 36–72 months (Refinance) |
3 more rowsSep 6, 2024