Auto Loans Quiz

What is the first step you should take when financing a new car?

• Figure out how much you are willing and able to spend

• Choose the color of the car

• Negotiate the interest rates

• Decide on the car model

What does a larger down payment affect?

• Decreases the loan amount, leading to savings

• Increases the loan amount

• Has no effect on monthly payments

• Increases the interest rate

What percentage of your income is advised not to exceed for car payments each month?

• 10%

• 15%

• 20%

• 25%

What can happen if you are unable to pay for the car?

• You get a free car wash

• You receive a trophy

• The car's color fades

• Your car will be repossessed and your credit score will be affected

What does your credit score influence when getting an auto loan?

• The car's brand

• The number of seats in the car

• The car's color options

• The interest rate on your loan

Why is it recommended to get pre-approved for an auto loan?

• To increase your credit score

• To have leverage when negotiating at the dealership

• To win a prize

• To get a free car

What should you compare when you have a pre-approved loan?

• Different car colors

• Different dealerships

• Different car models

• Different rates being offered

What does a shorter term length on a loan mean?

• Higher monthly payments but less interest overall

• Lower monthly payments but more interest overall

• No monthly payments

• Unlimited car washes

What should you not tell the dealer when asked about monthly payments?

• Your down payment amount

• The monthly payment you want

• Your credit score

• Your favorite car color

What is an alternative to buying if you don't plan on keeping the car long term?

• Teleportation

• Leasing

• Walking

• Cycling