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Many lending companies currently offer online sourcing for vehicle loans. Today's driver can find a way to finance a car, truck, motorcycle, or other vehicle without leaving the comfort of home. But where should you get a loan?

Most buyers will arrange financing through a car dealership. In this case, the car loan is granted for the full amount plus an agreed upon service charge. The loan may be arranged by the dealership, which then assigns the car loan to a third party (usually a bank or credit union) for management and collection. The buyer may also take a "direct lending" deal, receiving a loan from a financial institution like a bank. In these agreements, the buyer consents to pay back the total loan plus an additional finance charge.

A good rule of thumb is to keep the price of the car at less than 10% of your gross annual income. An auto loan is a significant debt that will be on your credit record for many years, and you will still have to spend money on insurance, car maintenance, and other expenses. You can always trade up if you can afford a more expensive car at a later date. Most experts would advise that you go to the dealership with a budget including financing rates in mind.

Another factor to consider with car loans is the length of the term. Often, the longer it takes for you to pay back the full cost of the loan, the higher the interest rate. All in all, any extra consideration a buyer gives to financing a vehicle will often result in a better deal.

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