Buying a car is one of the costliest purchases most people make in their lifetime, which is why it is important to ensure that you thoroughly understand the process of car financing before taking the plunge. Unless you are one of those rare buyers who can afford to pay the entire price of the car upfront, you will probably have to consider all the financing options before you pick one. Credit unions have emerged as a popular option for auto loans, principally because of the significantly low interest rates that they offer. Here, we shall be discussing how car financing from a typical credit union works.

1. The first step, of course, is to become a member of a credit union, if you aren’t one already. This is important because most credit unions offer auto loans only to their members. In fact, this is how they are able to function as non-profit organizations, and give back to their members in the form of low interest rates. Be sure to take a look at the type of loans offered by the credit union you are considering before becoming a member.
2. Once you have secured a membership with a credit union in your area, it is a good idea to take a look at their specific requirements for auto loans, and make sure you have all the documentation required for the loan application process. The paperwork is more or less the same as it would be at a typical bank, the only difference being that you can expect much better assistance and customer care at a credit union. It is a good idea to obtain your credit score and fix and discrepancies that might be present in your record before submitting your application.
3. With the first two essential steps of your auto financing taken care of, you now need to make the critical decision of which car you wish to buy. It is advisable to decide on the budget beforehand, so as to narrow down your choices of cars you can actually afford. You also need to decide whether you will buy a new car or a used one.
4. Finally, you need to decide on the amount of down payment that you shall be making, and the loan period that you desire, both of which shall determine your monthly payments.

We at Greater Central Texas Federal Credit Union provide you quick and cheap car financing in Texas. For more details, you can visit us at 3305 E Elms Road, Killeen, TX 76542. You can also call us at 254-690-2274.

• No alterations in the rate of interest irrespective of market conditions.
• Perfect option for people who have fixed budgets.
• It is a secure alternative.

• Loans are 1 to 2.5% higher than floating interest rate depending on the bank.
• If the interest rate decreases in the market, you will not get any advantage.
• In some instances the fixed rate home loan is fixed only for a few years and not the complete loan tenure.

• Cheaper than fixed interest rate home loans.
• If the floating rate increases than fixed rate, it is temporary and not for entire loan period.
• Can prove to be beneficial if you want to save money.

• Monthly installments are not constant.
• You can face difficulty in planning your budget.
• There has been a hike in floating interest rates in recent times.

If you have an image of your dream car and have done your research on the available models within your budget, it might be just the perfect time to make that purchase, and bring your gleaming set of wheels home! The last thing that needs to be a deterrent in achieving this dream is the lack of sufficient funds. After all, that is what auto loans are all about, and by fulfilling just a few requirements, you can get your dream car financed in a way that’s easier than you can imagine. When faced with a choice between secured car loans and unsecured ones, most buyers find themselves confused, and unable to make a choice between the two.

Let’s start by seeing how these two loans differ from each other. A secured car loan requires you to offer some “security” to the lender, which is usually the car itself. By putting your car up as collateral against your loan, you give the lender the right to claim your car if you fail to make the payments in time. On the other hand, an unsecured car loan does not require you to have any collateral, and compensates for that with a higher rate of interest, and less flexible payment options.

It is thus evident, that if you intend to pay back your loan (which should be the case anyhow), a secured auto loan is the better option to go by. Such a loan offers much better rates of interest, and also allows you to decide on a repayment period and payment interval that is convenient for you. The reason why the lender is more flexible in such a loan, is that he is more secure that you shall repay the loan, since your car is put up as collateral. The end result is a situation in which both parties are happy, with the lender being secure, and you having to pay lower monthly installments.

Even though different lenders have different requirements, the basic requirements that you shall have to fulfill to qualify for a secured car loan are-

• Proof of monthly income (pay stubs and bank statements/ income tax returns if you are self employed)
• Proof of employment (employment certificate for the last 12 months/ proof of steady income in case you are self employed),
• Residential proof (should prove that you have resided at your current residence/ a past residence for a period of at least 12 months.)

To avail cheap auto loans for both used and new cars in Texas, visit us at Greater Central Texas Federal Credit Union. We are located at 3305 E Elms Road, Killeen, TX 76542. You can also call us at 254-690-2274.