The Consumer Financial Protection Bureau (CFPB) has launched its new "Know Before You Owe" program that will assist consumers with learning how auto loans work, what their options are, and what financing is available to them. The program was announced alongside the "Consumer Voices on Automobile Financing" report that includes the CFPB's research on how consumers make decisions regarding auto financing.
Under the new initiative, consumers will be encouraged to learn about a number of key issues in shopping for an auto loan, including the following:
- How to gather and compare different auto loan options
- How to determine the total cost of the auto loan rather than looking only at the monthly payment
- How to spot and avoid financing that could result in additional fees or costs later on
Consumers will receive a detailed shopping sheet that will explain which parts of an auto loan can be negotiated and show them how to compare the costs of different loans, so they can make an informed decision.
Along with the shopping sheet, they will also receive the "Take control of your auto loan" guide. This guide will walk them through the entire financing process, something many first-time car buyers find confusing. It includes discussions on budgeting, types of financing, finding a loan, qualifying, and negotiating, plus a number of helpful tips.
The information can also be found on the CFPB's website.
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