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Car Loan Contract: Key Points to Consider Before Signing

Learn what to check before signing a car loan contract, ensuring clarity and avoiding pitfalls. Understand loan terms, payments, and total amount.

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Car Loan Contract: Key Points to Consider Before Signing

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  1. January 18, 2019 Bell Ringer Have you ever signed a contract? What do you think you should do before signing?

  2. Checking The Contract • When you take out a car loan, you sign a contract, or agreement. If there is anything in this contract you do not understand, ask the banker or the car dealer. If you still have questions, ask your city’s legal aid office. It is always good to have a friend with you when car shopping. • Read the contract carefully to make sure it is correct. Look for the following items before signing…

  3. Before Signing • Are all the blanks in the contract filled in? • Has the correct amount of the down payment been subtracted from the car’s total cost? • How many months is the loan? • How much are the monthly payments? When are they due? • What happens if a payment is late?

  4. Making Car Loan Payments • You make a down payment of $600 on a $1600 car. You still need $1000 more to buy the car. You decide to get a car loan from your bank. • The chart shows the amount of monthly car payments with different interest rates and terms.

  5. Using This Data • Suppose you get a car loan for $1000 with an interest rate of 9%. The term of the loan is 2 years. What is the total amount you will pay on the loan? • So how much interest did you pay? Remember that you borrowed $1000.

  6. Assignment • The Contract & Car Payments (Jan 18)

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