First-Time Car Buyer’s Guide: Getting the Best Auto Loan in Lancaster County

Buying your first car is exciting, but it can also feel overwhelming. Between choosing the right vehicle and figuring out financing, there’s a lot to consider. At First Lincoln Federal Credit Union, we’ve helped countless Lancaster County residents finance their first vehicle, and we’re here to guide you through the process. This guide will walk you through everything you need to know to get the best auto loan and drive off with confidence.

Understanding Auto Loans

An auto loan is a type of financing that allows you to buy a car by borrowing money from a lender. Instead of paying the full price upfront, you repay the loan over time with interest. For first-time buyers, knowing the basics can save money and avoid surprises.

Here are the key components of an auto loan:

  • Principal: The amount you borrow to buy the car.

  • Interest Rate: The percentage of the loan you pay in addition to the principal. Rates vary based on your credit score and lender. For instance, with First Lincoln’s One Rate Any Ride program, you get the same competitive rate whether you choose a new or used vehicle—eliminating the guesswork.

  • Loan Term: The length of time you have to repay the loan. Terms typically range from 36 to 72 months.

  • Monthly Payment: The amount you pay each month, which depends on the principal, interest rate, and loan term.

Understanding these elements will help you compare offers and choose the right loan for your budget.

Check Your Credit Score

Your credit score is one of the most important factors in securing a favorable auto loan. Lenders use it to determine how risky it is to lend to you.

  • Scores above 700 generally qualify for the best interest rates.

  • Scores between 650–699 may still get decent rates, though slightly higher than top-tier borrowers.

  • Scores below 650 might require extra effort, such as a co-signer or a larger down payment, to get approved.

Don’t worry if your credit isn’t perfect. First Lincoln works with members at various credit levels to find solutions, including options like co-signers or larger down payments when needed.

Before applying for a loan, check your credit report for errors and make sure your score is accurate. This small step can save you hundreds in interest over the life of the loan.

Determine Your Budget

Knowing how much car you can afford is critical. Start by looking at your monthly income and expenses. Experts recommend keeping your car payment at or below 15% of your monthly take-home pay.

Other costs to consider include:

  • Insurance premiums

  • Registration and taxes

  • Fuel and maintenance

Having a clear budget will prevent you from overextending yourself and help you choose the right loan term.

Start Your Search with First Lincoln

One of the biggest mistakes first-time buyers make is settling for the first loan they are offered. Start your search with First Lincoln Federal Credit Union, which offers auto loans Lincoln NE residents trust, with one competitive rate for any vehicle and terms from 24–72 months (up to 84 months for loans over $20,000). Then compare with other local lenders to ensure you’re getting the best deal.

Other options include:

  • Banks: Traditional banks may have a wide range of loans but could require stricter credit requirements.

  • Online Lenders: Digital lenders can be convenient and quick, though rates may vary widely.

Comparing multiple offers ensures you get the best deal and avoid paying more than necessary.

Get Pre-Approved

Pre-approval is when a lender reviews your financial information and gives you an idea of how much they are willing to lend and at what rate.

Benefits of pre-approval include:

  • Knowing your budget before shopping for a car

  • Strengthening your negotiating power at the dealership

  • Reducing the chance of being surprised by higher interest rates

Getting pre-approved at First Lincoln is simple and fast with our easy online application. You’ll know exactly what you can afford before stepping foot in a dealership.

Understand Loan Terms

The length of your loan affects your monthly payment and the total cost of the car.

  • Short-term loans (36–48 months): Higher monthly payments but lower overall interest.

  • Long-term loans (60–72 months): Lower monthly payments but more interest paid over time.

Think about what works best for your budget and financial goals. Avoid extending the term just to lower monthly payments—it can cost more in the long run.

Consider a Down Payment

A down payment reduces the amount you borrow, which can lower both your monthly payment and the total interest paid. A typical recommendation is 10–20% of the car’s price.

Benefits of a down payment include:

  • Helps secure better loan terms

  • Reduces the risk of owing more than the car is worth

  • Shows lenders that you are financially responsible

Even a small down payment can make a significant difference.

Look Beyond the Interest Rate

While a low interest rate is important, it’s not the only factor to consider. Pay attention to:

  • Fees and charges (origination fees, late fees, etc.)

  • Early repayment options

  • Customer service and support

A lender that provides clear terms and responsive service can make your first auto loan experience much smoother. First Lincoln Federal Credit Union combines competitive rates with personal service tailored to your unique situation.

Tips for First-Time Car Buyers

  • Do Your Research: Compare car prices, features, and reviews before visiting a dealership.

  • Stay Within Your Budget: Avoid the temptation to upgrade to a more expensive model.

  • Read the Fine Print: Make sure you understand all terms before signing.

  • Negotiate: Even with pre-approval, dealers may be willing to offer incentives or discounts.

  • Consider Total Ownership Costs: Factor in insurance, maintenance, and fuel costs when calculating affordability.

One Rate Any Ride Program Benefits
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  • Same Rate for New or Used Vehicles

  • Terms from 24–72 months (up to 84 months for loans over $20,000)

  • Easy Online Application

  • Vehicle loan rates as low as 5.25% APR*

  • No Prepayment Penalty

  • Trade-In and Retail Values to Negotiate Your Best Deal

  • Multiple Payment Options (Payroll Deduction, Automatic Transfers, or Recurring Payments)

  • Optional Credit Disability & Credit Life Insurance

  • Optional Extended Warranty and/or GAP

Why Choose a Credit Union for Your Auto Loan

Credit unions often offer advantages over traditional banks for first-time buyers.

  • Competitive rates: Federal credit unions Lincoln NE residents rely on frequently provide lower rates compared to many banks.

  • Member-focused service: Credit unions prioritize member satisfaction and may offer more flexible terms.

  • Educational resources: Many credit unions provide guidance for first-time buyers to understand auto loans fully.

First Lincoln Federal Credit Union exemplifies this approach, helping first-time buyers navigate financing with confidence.

Final Thoughts

Buying your first car in Lancaster County doesn’t have to be stressful. By understanding your credit, setting a realistic budget, shopping around, and considering a credit union like First Lincoln, you can secure an auto loan that works for your needs. Preparation is the key to confidence.

Getting the right loan can save you money, reduce stress, and make your first car-buying experience enjoyable. Take your time, do the research, and make informed decisions. Your first car should be a source of pride and convenience, not financial strain.

Ready to buy your first car? First Lincoln Federal Credit Union members enjoy competitive rates, flexible terms up to 84 months, no prepayment penalties, and personalized service. Apply online today at firstlincoln.org or call (402) 466-4040 to speak with our lending team.

Gil Golan