President’s Message February 2012

Growing Demand for Auto Loans

Throughout the recession, consumers have tended to keep their automobiles longer and put off buying new ones. In an effort to keep monthly payments as low as possible and protect themselves from uncertainty in the job market, consumers have put money into repairs instead of purchasing new cars. As a result, monthly book prices on used autos have actually gone up monthly for many months. This trend appears to be changing now. New auto sales are up slightly across the nation and we are seeing an increase in Utah as well. Economists predict that the “pent up demand” for new autos will boost new auto sales throughout 2012.  Buying a used auto still makes a lot of sense for many people although we will continue to see many programs aimed at encouraging consumers to purchase new autos.

New or Used – We’re Here to Help

Depending on your situation and your needs, buying either new or used can be the proper choice. Either way, your credit union is ready to help you finalize the purchase. Record low rates are available along with payment terms that will meet your budgeting needs. Auto loans tend to be a substantial part of household budgets. Finding the right terms, rates, and payments can be as important as finding the right auto.

Get Prepared Before You Shop

We suggest several things to help you be successful in your next auto purchase experience.

  • Determine how much you can afford. What monthly payment will fit into your budget? We can help you on-line or in person to determine what size of auto loan makes the best sense for you.
  • Check out what kind of autos fit in your price or payment range. What kind of auto do you need? Use the internet to see what is out there and what kind of prices exist for what you need. You can contact the credit union to double check on book prices and values.
  • Check with UCCU for pre-approval. This will help you shop with confidence, knowing that you already have financing arranged with terms and payment amounts that fit your budget.
  • Find a reputable dealer – they are all around – or, if you are buying on-line – be sure to check out the auto sufficiently.  Car-Fax and other history checks may be available. Often it is wise to take the auto to your trusted mechanic for a check-up.
  • Be disciplined. Once you know the price that is right for you – stick to your plan. Do not shop for a vehicle based on monthly payments alone. Sometimes extended loans lower your monthly payments but you may find that your loan lasts longer than your auto.  Be careful – while extended loan terms can lower your monthly payment – they can also make it harder for you to get financing on your next trade-in our auto purchase.
  • Extended warranties and other add-on options offered by dealers may be a wise investment. Determine what is best for you. Depending upon the age and condition of the auto, some options may make more sense than others.
  • Do not be in too much of a hurry. A wise old adage is to “never shop and make a major purchase on the same day. Sleep on it.” The idea here is to take the necessary time to prepare, compare, and then make a thoughtful decision. After all, you will be paying for the auto for a while – and hopefully driving it even longer.

Happy shopping – and do not forget to rely on your credit union in the process. Our goal is to be your “first choice” financial partner – helping you make smart decisions about your finances and your life.

Jeff Sermon
Utah Community Credit Union

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