Find the Best Auto Loan Companies in Buffalo, NY

Comparing auto loans in Buffalo

Before accepting a loan offer, shop around for multiple quotes from various lenders, including banks, credit unions, dealers and auto finance specialists. Understand the different types of car loans so you know what to expect. Secured simple interest loans are the most common auto loans, typically offered by dealers, credit unions and banks. Other types include unsecured, car refinance and lease buyout. For each type of loan you consider, look for the lowest interest rate available. Choose a term length with payments that fit your budget. Make sure you know all the associated fees, which are included in the annual percentage rate (APR) of the loan.

• Interest rate: Interest rate is the amount the lender charges you to borrow money. Lenders determine your car loan interest rate based on your credit score and other factors. Interest rates on car loans at the time of publishing range from anywhere from 1% to 18% or more, depending on many variables.
• Term length: Term length refers to the amount of time you have to pay off the loan. Typical term lengths for secured simple interest loans and car refinancing are 24 to 84 months. Unsecured loans generally have shorter term lengths — 12 to 36 months — with higher interest rates. A longer term length lowers monthly payments, but you pay more over time; a shorter term length allows you to pay off the loan more quickly and save money on interest.
• Down payment: Your car loan down payment is the amount you pay upfront, either to the dealer or directly to the lender. A large down payment will mean a smaller loan. Simple interest loans from banks and credit unions typically offer 100% financing for qualified customers, so a down payment might not be required. For borrowers with lower credit scores, the down payment required will depend on the loan amount and vehicle price.
• Taxes and fees: Auto loan taxes and fees are added to the amount you pay. Taxes include sales tax on the vehicle. Typical fees include document fee, financing or funding fee, and title and registration fee. Banks and credit unions usually roll the fees into the loan, while other lenders might require you to pay taxes and fees upfront.

Using the information you find about loan interest rate and term length, decide what down payment you can afford and plug the numbers into a loan calculator to find your monthly payment. You can play around with different scenarios to see how interest rate and term length affect the total cost of the loan.

For example, consider a 2018 Honda Accord that sells for $22,895. If you make a down payment of $5,000, with a 60-month term length at 4% your monthly payment will be $330 and the total cost of the loan will be $19,800. With the same down payment and term length at 7%, your monthly payment will be $355 and total cost will be $21,300.

Interest rate, term length and down payment make a big difference in the overall cost you pay for a loan. Shop around for multiple offers and run the numbers for each to find the best rates and lowest-cost loan for your situation.

How to get a car loan in Buffalo

Many lenders accept car loan applications online, or you can apply in person at banks and dealerships. For most auto loan applications, you will need your Social Security number, proof of income, proof of residence and current driver’s license. If you plan to drive away in your new car you will need proof of insurance before leaving the dealer.

The lender will check your credit to determine if you qualify, but it’s recommended you review a copy of your credit report so you know it's accurate. Lenders will primarily consider credit score and income when deciding to offer you an auto loan. For customers concerned about low credit scores, auto finance specialists can help you find vehicle loans designed for your financial circumstances.

After you qualify for and accept a vehicle loan, you might be required to pay taxes and fees upfront. Some lenders allow you to roll these costs into the loan. Most car loans do not require additional collateral because the vehicle itself secures the loan. But if you are taking out a secured loan from a lender that is not a dealer or bank, you might be required to put up other property as collateral. Home equity, a savings account or another vehicle you own can be used to secure an auto loan.

Buffalo car loan FAQ

Can I finance a used car?

Financing is available for used cars. Some lenders have a limit on the age of the vehicle eligible for a car loan.

What happens when you pay off a car loan early?

When you pay off a car loan early, some lenders have no prepayment penalty. That means you can pay off the principal balance with no additional money due and save money on the interest you would have paid. Other lenders charge a penalty for paying the loan off early.

What is the average monthly car payment in Buffalo?

According to AutoWise, New York residents pay an average of $338 monthly for used cars and $540 per month on new car auto loans.

Can I apply for a car loan before going to the dealer?

Yes, you can apply for a car loan before visiting the dealer. Banks, credit unions and some auto financing specialists will give you a loan offer that you can take to the dealer.

How long should you finance a car?

While auto loan term lengths range up to 84 months in some cases, you should not finance a car for such a long time that what you owe on your loan is significantly more than the car is worth.