Advanced Subaru Financing APR Percentages Explained

If you've decided on a Subaru finance deal for your next new or pre-owned vehicle, it's vital to familiarize yourself with each step of the auto loan process. One of the most important aspects of an auto loan is the APR, which stands for the annual percentage rate. To learn more about what APR percentages entail and how to get preferential terms on your next contract, visit Jensen Subaru today.

What is APR?

It's extremely uncommon to be able to afford a brand-new vehicle in pure cash. Most customers need an auto loan that lets you borrow money and pay off your car over time. Each loan agreement comes with an interest rate, commonly represented as the APR. In reality, the APR represents more than just interest - it also includes any additional fees such as the origination fee or other prepaid finance charges.

Why Does the APR Matter?

 

The higher your APR, the more money you'll be paying over time. Lower interest rates may seem more beneficial, but there are often hidden fees that aren't taken into account. With an APR percentage, you can see the full picture of what you owe and how much you need to pay each month to stay above water. Simply put, an APR gives you a clearer idea of what exactly you're paying for.

What Determines APR?

APRs are incredibly complex, so there's not a one-size-fits-all solution for every new Subaru vehicle. There are several different considerations that the loaner will make before giving you an offer with an APR. Here are some of the biggest factors for APR:

• Current credit score and history
• Your desired auto loan length
• How old the vehicle is
• Your current income
• The down payment amount

Once all of these factors are considered, you'll be given an APR with a total breakdown of fees that may cause it to increase in the future.

Learn More About Annual Percentage Rates in Sioux City, IA, Today

If you have any further questions about the vehicle financing process, contact our Sioux City, IA, Subaru dealership. We also have several Subaru specials that may apply to the vehicle you're interested in. Schedule an appointment or give us a call for more info!