Are you looking to purchase a new a car? Forget the financial struggles and spend more time focusing on what really matters—your new purchase! You might be just starting to look at vehicles, or maybe you’re ready to drive your new car out of the dealership— whatever stage you’re at, finding the right auto loan is key to your investment and future financial health. These tips will help you in securing the best auto loan you can.

Evaluate Your Credit

Your credit is an important factor in whether or not your loan will be approved. A potential lender will evaluate how much you money you currently owe and how reliable you are at paying creditors back. Why does your credit score matter? A good credit score will get you a lower interest rate on your auto loan, meaning you’ll pay less for your car each month, and over the life of your loan. You can check out the difference using this Loan Savings Calculator at myFICO.com. Wondering what your credit score is? Creditwise is a free resource that will check it for you.

Create a Budget

You need an idea of how much you are willing to spend on a car – both on a downpayment and on monthly payments going forward. This information is best known before you step onto a car lot to avoid falling in love with a car that’s out of your price range. Your downpayment is an up-front payment on the car so the larger it is, the less you’ll need for your auto loan. Consider putting 20% down – this will reduce the amount of interest you pay, so you avoid paying a lot more for your car than what it is worth.

Your monthly payments are the payments you make on your vehicle every month over the life of your loan (typically three to five years). If you go overboard and make them too high, you may feel the consequences in years to come if your financial situation changes. You’ll also want to keep your loan term as short as possible, even under four years, to avoid paying a more in total interest paid than necessary.

Shop Around

Don’t be tricked into getting the first loan you’re offered (especially if it’s from the dealer). Check with a variety of lenders, including your local credit union, to find the best auto loan options possible. You also are not required to take out a loan at the same institution where you keep a savings account. Sometimes auto dealers can offer an unbeatable deal, but do consult with an alternative lender to know what’s available to you. Use your credit score to your advantage here, but remember to negotiate, even if your score is lower than ideal.

Taking out a large loan, especially if it’s your first, may seem scary at first, but doing your research can save you a large amount of money in the long run. There are many different options out there for those with a great credit score and for those who are just starting to make a financial footprint. If you have any questions, your local credit union is ready to help.