LENDERS TAILOR AUTO LOANS TO MEET NEEDS OF TODAY'S
BORROWERS
The Sunday Oregonian (Portland, Oregon)
January 28, 1996 Sunday, SUNRISE Edition
Copyright 1996 The Sunday Oregonian All Rights Reserved

Section: 1996 PORTLAND INTERNATIONAL AUTO SHOW; Pg. R34
Length: 726 words
Byline: CRAIG BROWN Special Writer

Body
Sunday, January 28, 1996 LENDERS TAILOR AUTO LOANS TO MEET NEEDS OF TODAY'S BORROWERS
To see an incredible variety of new cars and trucks, visit the Portland International Auto Show. To see an incredible
variety of ways to finance those dream machines, visit your friendly loan officer.
These days, auto loans can be tailored to suit the needs and desires of almost any borrower. Of course, a
purchase can always be financed through a dealer, and dealers have a variety of loan packages available. Private
lenders, too, are matching financing packages to meet almost any situation. Here are just some options: - The
traditional three- or four-year loan repayment schedule can be stretched to 72 or even 84 months for some models,
which makes the monthly payment more affordable. - You can finance up to 100 percent of the purchase price. Homeowners can tap a home equity line of credit, which may be tax-deductible. - Interest rates can be fixed or
variable, just like a home mortgage. - People with no credit or poor credit often can get loans, although interest
rates tend to be higher. - Many late model used vehicles can qualify for the same financing rates and loan terms as
new cars.p Stretching payments is one of the most common ways to deal with rising sticker prices. ''The
preponderance of the new car loans are 60 to 72 months,'' said Tom Bourdage, vice president of product
management for U.S. Bank of Oregon. Loans on late-model used vehicles typically stretch from 48 to 60 months.
- Lower payments
The extra length means the customer will pay more interest over the life of the loan. But the payment on $20,000
borrowed at 9 percent is $500 per month for 48 months. Stretched over 72 months, it drops to $360. That's why
``my average new auto loan goes out at just over 60 months,'' said Paul Hodge, vice president of financial services
at Columbia Credit Union in Vancouver. Luckily, ``cars are actually being made to last a little longer,'' he added, so
the vehicle has a good chance of outliving its loan.
Another trend is for homeowners to bypass a traditional auto loan and tap their home equity. There are several
advantages, explained Rich Weissman, a senior vice president at Bank of America Oregon.
First, repayment terms are much longer. Loans can run from 10 to 25 years. The interest rates are as low or lower
than auto loans, ``and by loaning against the home in many instances it's tax-deductible,'' Weissman notes.
However, he suggests car buyers consult their tax adviser before sealing the deal.
There are two common ways to tap the equity. The first is to set up a line of credit. This works almost like a
revolving credit card account. The interest rate varies, and there's a minimum monthly payment, but few other
requirements. The second method is to set up a formal loan, which fixes the interest rate, monthly payment, and
length of term.

Akela Lacy

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LENDERS TAILOR AUTO LOANS TO MEET NEEDS OF TODAY'S BORROWERS
At least one local institution, Safeway NW Central Credit Union, offers a blended program. Called the Auto Equity
Loan, it starts as a conventional auto loan with same-day approval. Later, after the required paperwork is done on
your house, it can be converted to a home equity loan at no cost to the member, said Jim Milner, vice president of
lending.
- Stable interest rates
A bit of good news for borrowers is that interest rates have remained relatively flat over the past few months. Loans
for new or late model vehicles are at about 9 percent or less. Some credit unions are now offering variable interest
rates. Multco Credit Union, for example, recently offered a 6.9-percent variable rate on all new vehicles and used
vehicles as old as 1986 models.
Another trend carrying over from the mortgage industry is the concept of preapproval. ''It's just like buying a house
-- it's better to be preapproved before you go to buy,'' said Susan Thomas of First Interstate Bank of Oregon. Most
financial institutions offer same-day approval, and some will even deliver the check to the dealer for you.
Several Portland-area credit unions have formed a service called Credit Union Loans. Today which grants loan
approvals and quotes new and used vehicle values on weekday evenings and weekends, when offices are closed.
Participants are Washington County Federal Credit Union, United Grocers NW F.C.U., and Clackamas F.C.U.
Shoppers, start your engines!

Classification
Language: ENGLISH

Publication-Type: Newspaper

Subject: INTEREST RATES (90%); EXECUTIVES (89%); TAXES & TAXATION (89%); HOMEOWNERS (88%);
PRICES (77%); TAX CONSULTING (72%); PRICE INCREASES (68%)

Company: BANK OF AMERICA CORP (58%)

Ticker: BAC (NYSE) (58%); BAC (LSE) (58%); 8648 (TSE) (58%)

Industry: INTEREST RATES (90%); AUTOMOBILE FINANCING (90%); BANKING & FINANCE (89%);
PERSONAL FINANCE (89%); LINES OF CREDIT (89%); HOME EQUITY CREDIT LINES (89%); FRIENDLY &
PROVIDENT SOCIETIES (78%); MOTOR VEHICLES (78%); NEW CAR MODELS (78%); REVOLVING CREDIT
(73%); TAX CONSULTING (72%); CREDIT CARDS (69%); PRICE INCREASES (68%)

Geographic: PORTLAND, OR, USA (58%); OREGON, USA (90%)

Load-Date: April 6, 2006

End of Document

Akela Lacy