Auto loans hide cost in lots of small places. Run through these seven questions before you sign anything — they’ll surface most of the games.
- What is the APR — not the monthly payment? Lenders love to negotiate on monthly payment because stretching the term hides a higher rate.
- What is the total cost of the loan? Principal + interest. Look at that number, not the per-month one.
- Is there a prepayment penalty? If yes, refinance later costs you.
- What’s in the “doc fee” or “acquisition fee”? Some are real, some are negotiable padding.
- Is GAP insurance included or sold separately? Often it’s already covered by your auto insurance.
- What’s the late-payment policy? Day-late fees vary widely.
- Can I see the truth-in-lending disclosure before I sign? You’re entitled to it.
If the dealer or lender resists answering any of these, that’s the answer you needed.