How Does Car Financing Work?

Couple sitting at sales desk at dealership
Whether you’re interested in buying a new or used car to enhance your drives around Merced, you will likely apply for financing if you’re unable to purchase the vehicle outright. What is car financing? If you’re wondering, “What does it mean to finance a car?”, we have your answers in this helpful guide from Mercedes-Benz of Modesto.

How Does Financing a Car Work?

The first step in learning how car finance works with a new or used vehicle is to apply for a loan through either our Stockton-area dealership, your local bank, or a credit union. Your auto loan application can be started online, or you’re able to apply at the dealership. Some factors that financial institutions consider include:

  • Credit Score
  • Loan Amount
  • Length of Loan
  • Debt-to-Income Ratio
  • Age of the Vehicle

If you have little credit, an unimpressive credit history, or have a poor credit score, you may want to ask a family member or a close friend to co-sign the loan.

Choosing Your Lender

Once you have been approved for your loan, you will have a few options to choose from. If the dealership offers in-house financing, you can compare your offers and choose the one that best fits your financial needs. Consider how much you’re able to put down and what you can afford in terms of monthly car payments. It’s essential to remain within your budget so you’re able to pay off the loan on time.

Finalize the Loan Terms Near Turlock

Before officially financing your loan, you may get to negotiate the price of the car and settle on an interest rate that you’re able to. At Mercedes-Benz of Modesto, we work hard to make sure you get the monthly payment that you can afford. Then, you’ll sign all of the necessary paperwork and then drive home in your dream vehicle that’s going to take your commute to the next level.

Learn More About How Car Finance Works at Mercedes-Benz of Modesto

We’ve answered, “How does finance a car work?” Now it’s time to make the short drive to our dealership near Stanislaus to get behind the driver’s seat of your dream vehicle. Give us a call if you have any questions!

More from Mercedes-Benz of Modesto

  • 2021 Mercedes-Benz GLC Colors

    The GLC may be the best-selling Mercedes-Benz model, but with 12 stunning exterior colors to choose from, you’ll always stand out from the crowd in Merced. Plus, a wide range of available interior accents and exterior detailing offer even more ways to customize. Read below for an overview of the Mercedes-Benz GLC 300 colors, and…

  • What’s Inside the 2021 Mercedes-Benz E-Class Interior?

      The new Mercedes-Benz E-Class interior cabin offers premium amenities and advanced technologies that the Mercedes-Benz brand is known and praised for. Thanks to new features like Mercedes-Benz User Experience and a redesigned steering wheel with built-in touch sensors, this is one luxury vehicle worth checking out at our dealership near Merced. Explore the 2021…

  • 2021 Mercedes-Benz GLE Configurations

    The 2021 Mercedes-Benz GLE is a highly-praised vehicle with advanced technology features in a fully-furnished and comfortable interior that also offers three powertrain options. The Mercedes-Benz GLE brings an excellent combination of powerful performance and sophistication to the Merced roads. Thanks to the available six trim levels to choose from, you won’t have trouble finding…

Saved Vehicles


You don't have any saved vehicles!

Look for this link on your favorites:


Once you've saved some vehicles, you can view them here at any time.

Contact Us

(855) 474-0585

Call Now

3900 McHenry Ave • Modesto, CA 95356

Get Directions

Today's Hours:

Open Today! Sales: 10am-6pm

Service: Closed

Parts: Closed

Mercedes-Benz of Modesto 37.6959772, -120.9936599.