It's an exciting time, buying your next car. Upgrading from your current ride to something newer and nicer can make you feel empowered, but when it comes to financing, there may be some confusing details you need to work through.

To help, we've assembled this list of things you can expect when financing a vehicle. There's no need for all that paperwork and those financial agreements to stop you from enjoying your new vehicle. Learn as much as you can beforehand.

What to Do Ahead of Time

Finding out the status of your credit score is perhaps one of the most important steps you can take before financing your new vehicle. The better your credit score is, the higher chance you have of qualifying for a lower interest rate.

You should do your homework on what kind of interest rates to aim for. Being informed on rates that other institutions can provide will help with the negotiation process. Getting pre-approved can also help you save time during the purchasing process.

Also, it's important to find out what you can afford. It's helpful to do this with your credit score in mind so that you can stay within your preferred budget.


What You Need to Bring with You

There are four important documents you'll need to bring with you when buying a vehicle.

1. Proof of income

Be sure to bring copies of pay stubs from last month as well as what you've been paid to-date the past year.

2. Credit and banking history

This includes any information about other outstanding loans or financial obligations you may have, as well as how you've fared in the past financially. These may include mortgage or lease agreements, alimony or child support payments, credit card statements or bank statements.

3. Proof of residence

Personalized mail or your mortgage statement are typically enough to provide reasonable proof of residency.

4. Proof of insurance

Your lender will require proof that your insurance company is aware of your newly purchased vehicle and that it's properly insured.

If you're not financing with the dealership, you'll also want to bring proof of your loan.


Know What Determines the Loan Terms

A typical automotive loan will last between three and five years. Your lender will run a credit check and ask income-based questions. Your interest rate will be determined by how secure the lender perceives your finances to be. This means if you have a better credit score, manageable debt, a good standing with your insurer and a high income, you're more likely to qualify for a lower interest rate. If not, you can plan your monthly payments with a higher interest rate and try to make it as manageable as possible.


If you'd like to learn more about what to expect when financing a vehicle, or if you have any questions, give us a call or visit our dealership at 3333 North Main St., Gainesville, FL 32609. We look forward to serving our customers near Alachua, Starke, Ocala and Lake City.