Pros and Cons of Skipping Payments with Your Auto Finance in North Las Vegas
When it comes to buying a new or used car, you have a lot of things to consider. On the lot, you are focused on features and colors that fit your personality and lifestyle needs. When it comes time to sign on the dotted line, however, there are many things to consider. After all, cars are a costly investment, and you'll want to make sure you take the time to understand all of the fine print before you put the keys in the ignition so you don't find yourself upside down when the deal is done.
If you are in the car-buying process, or if you already have an existing auto loan, you may have been enticed by offers to skip a payment with auto finance in North Las Vegas. Naturally, this seems like a great deal that can put some cash in your pocket when you need it most, but, like all good things in life, there are some drawbacks.
Here are some things you should know about skip-a-payment incentives:
Pro -- You keep some cash in your pocket.
Who couldn't use a little extra cash from time to time? Skip-payment offers are excellent if you're in a pinch and in need of a little extra cash to pay for essentials. If you're struggling to pay your energy bill or keep groceries in the kitchen, several hundred dollars from a skipped car payment can make a world of difference.
Con -- You tack money onto the total cost of your loan.
What many people don't realize is you still incur interest when you skip a payment, which means the total expense of your loan will end up costing you more than you initially signed up for.
Each time you make a car payment, a portion of that money goes toward interest, and the rest goes to the principle (or actual cost) of the car.
In the beginning of a fixed-rate loan, the majority of your payment will pay for the interest, but as you chip away at your payments, more and more money will be attributed to the principle cost.
When you skip a payment, you are not paying any principle or interest that month, but your loan's interest still accumulates over the life of your loan.
Offsetting the Additional Cost
If you are in a pinch, skipping a payment can be a great option, but it's important to understand the financial implications associated with such an action. Unless you are able to make additional payments to your auto finance creditor in North Las Vegas, the final cost of your loan will be higher if you do choose to skip a payment. To offset this cost, set aside a little extra money each month to pay on the principle of the loan.
Get Auto financing in North Las Vegas
Turn to Clark County Credit Union, and receive the auto finance North Las Vegas residents love and trust. If you're ready to hit the road in your new or new-to-you car, get started by applying online or calling 702-228-2228 today!