What to Consider When You Buy a Car

This post is sponsored by Community Choice Credit Union.

car loans

It’s happened! You need to buy a car and found the perfect set of wheels. You stayed within your budget. The sales agent even helped you get the price you wanted! Now that’s a win!

But then you realize, there may be more than just the base price of the car you hadn’t thought about.

What to Know When You Buy a Car

As you prepare to buy a car, here are four questions you will need to consider to ensure you are getting the best deal for today and tomorrow.

What is Gap Insurance?

GAP Insurance, short for Guaranteed Asset Protection, is exactly what it sounds like: it’s insurance to ensure that if your car is totaled and you owe more than the current market value of the car, you are covered for the difference between what your every-day auto insurance will cover (which only pays out at the current market value) and what you still owe on the car loan.

gap insurance

This is a great added investment whether you are buying a brand new car or even a used one and only utilizing a small down payment.

Should I Get an Extended Warranty?

While you never want your car to break down we know at some point, it will. Just like anything else with moving parts, eventually, it will have some kind of an issue that needs to be repaired.

Extended warranties come in all shapes and sizes, but they are designed to cover the larger-priced repairs that can sometimes pop-up with cars, especially when buying a used vehicle.

This add-on when buying your next car is worth considering, especially because car buyers crave reliability and peace of mind.

One other thing to keep in mind: these extended warranties can often vary in length of time, coverage, and price. So do your homework and if you can fit it into your budget, this add-on is something to consider.

What is Credit Life?

Credit Life Insurance? That’s a thing? It sure is. Depending on the cost of the vehicle you are looking at, the loan value, and your overall life circumstances, it is something to look at and consider. Credit Life is the same concept as GAP Insurance. Only thing is, it’s all about you: the owner.

In the terrible situation that you should pass away while there is still a loan out on the car, this insurance will kick in and pay the remaining loan balance in full. It works just like life insurance, only for your car.

This policy is especially good if you are buying a brand new car and only putting a limited amount down.

What About Credit Disability?

Yep, that’s real too. Just like with Credit Life, Credit Disability Insurance is all about you. A sudden and unexpected injury can quickly change you and your family’s financial future. Because there is no way to predict these major life events, adding Credit Disability Insurance is another way to protect your family from those UNexpected moments in life.

It works like this, in the instance you become disabled while you have your auto loan and can’t work – and therefore can’t pay for the car loan – this insurance ensures you don’t lose the car!

Credit Disability Insurance will kick-in and pay off the balance in full should you become disabled while you’re still paying on the loan so you don’t have to tap into your other disability income.

When these four options are put together, it ensures you and your asset are protected and your savings, salary, and other life insurance claims go to where they are needed the most. Find out more about these different options, including making no payments for three months on your next vehicle purchase.

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This post is part of a series of posts from Community Choice Credit Union

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