Auto Purchases Up to Boost Consumer Borrowing
If you’re wondering how your neighbors are spending, you don’t have to – they’re taking out new auto loans and buying cars. This is helping consumer borrowing in general, but still isn’t a sign of recovery in consumer spending. Much of the recovery expected to occur this year and next is dependent on the ability of consumers to borrow and buy, in turn stimulating the economy. Borrowing in the auto loan category rose 6.9%, but credit card usage dropped from December to January by 6.4%. Put simply, consumers are still sending a mixed signal. During boom times, consumers borrowing and credit should show signs of growth month over a month. Businesses use these reports when deciding whether or not it’s a good time to expand and grow, which in turn promotes more hiring to complete the growth cycle. This clearly is not the case at the moment, but it seems to be a good sign for the economy nonetheless.
Unemployment Rates Fall to 8.9% – Are Interest Rates on the Rise?
The U.S. government today released an unemployment report with many positive signs for a recovering labor market, including a rise in payrolls of 192,000 – the unemployment rate now stands at 8.9%. While an economic recovery is something everyone wishes for, there could be a negative impact on interest rates for auto loans or mortgages. The Fed introduced about $600 billion into the money supply via Quantitative Easing II, and in order to control inflation, they would have to raise interest rates and allow the money to contract once more. This means that while you may now find employment since being unemployed, the interest rates on consumer goods like cars will also rise alongside it.
Car Loan Rates
Auto loan rates are important to everyone driving, because it gives drivers the option of buying more expensive cars by paying off a loan on a monthly basis. Depending on your credit and your financial situation, you can get a car loan that lasts from 1-5 years, spreading out your payments for a car purchase. US Banking Rates works with lenders, banks and finance companies that help different people based on their needs. You can receive a free auto loan quote from these lenders, and know how much you can borrow before searching for a car.
What to Look for in an Auto Loan
Typically, if you are buying a used car versus a new car, Auto Loan Rates will be a little higher (up to 1% more). Auto Loan companies are looking at the value of the car, and your ability to make payments back to them. If you are purchasing a car in good condition or a new car, these companies can offer good loan rates because if a borrower does not make payments, then the company can take back the car and try to sell it to get their money back. US Banking Rates will match you with a lender that wants to work with you, and understands your credit rating. By working with the right company, you can secure a low interest rate auto loan
What is the Best Auto Loan for you?
Choosing an auto loan is not just about getting the lowest interest rate, you also have to decide how long you want the loan to go. If you are buying a used or new car, think about how long you might drive the car, or how long until you would want to buy another car. Also, the longer you extend the loan, you can usually lower your monthly car payments, but you will pay a lot more interest because of the longer term. To get the lowest auto loan rates, a car buyer would secure a shorter term loan (12-36 months).
Credit Scores and Car Loan Rates
If you have ever been in a car dealership talking to a salesperson, eventually they are going to ask you what your credit looks like. This is very important for the salesperson because not only do they want to sell you a car, they need to be able to know you can get a car loan to pay for it. If you have good credit, they can get you a low car loan interest rate and approve you for the loan, but if your credit is not so good, it may be more difficult for them to make the save.
United States Auto Loan Rates
Before you purchase a new car in United States, be sure to check the current auto loan rates. United States Banking Rates can help you to find a lender that will offer the most competitive rates on your next auto loan.
Getting a Low United States Auto Loan Rate
The terms of your auto loan can affect the interest rates. If you choose a 36-month repayment term, you are more likely to get lower interest rates. If you choose a longer term, not only can your interest rates be higher, but you will pay more interest on your auto loan in the long term.