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Car Auto Loan
Are You In The Market For a Car Loan?
by: Mike Yeager
Car loans are a tempting way to purchase a new car. While they provide for easy access to a car, these loans can get quite expensive if you do not know enough about what you are getting into. Simple research will provide you with information that can save you some real expenses. Even if you are getting a used car loan or a car title loan, you need to understand what you are getting into.
Most of the time, when a buyer enters a car dealership, they already have an understanding of what they are looking for in a car and how much they can spend. But, how much research was given to the loan you may be picking up in the process? Choosing this wisely, is key to getting a good deal on a car. To find information, consider looking at different lenders and different dealerships. You do not have to get the loan through the dealership. You may be able to get one, at a lower cost, through your own bank especially if you have developed a good relationship with them.
Being aware of how much the interest rate is like being away of the gas mileage on that new car. You need to ask questions and be prepared with answers. For instance, you may be looking to purchase a used car and therefore would be looking into a used car loan. The car you choose and want to purchase will cost you 5000 paid over the next 5 years. But, what happens 3 years into the picture? The car isn't worth the amount you still owe on it because the interest rate was so high or you didn't make a down payment.
Consider the situation there. You have a loan and a run down car that may or may not have been worth it. Add into this a bad credit used car loan, with even higher interest rates and fees, and you are really hurting.
The car loan you choose should be one that reflects your credit, the car, and your understanding of the loan. Perhaps you can pay an additional amount of money a month, and cut the interest rate down over the course of the loan. Researching your options, good or bad credit, will give you more of an understanding of what's available. Simply check online (or search online) for lenders that can offer you quotes for the type of loan you are looking for. Undoubtedly, you will find many options. You will have companies competing for your business now. Choose wisely, and based on your research.
Have you noticed that everyone seems to have a newer car than you? There's good news. You can find a way to upgrade your old clunker to a newer model. There are many ways to save money on your car loan. Lenders are competing for your business, and more and more car loans are approved to allow more people than ever to buy a car.
So now that you've decided to buy a newer car, the question on how to pay for it arises. If you're like most people, you don't have the cash needed to buy a new car. The other option is to borrow the money. There are certain guidelines to follow which could help you save money on a car loan. Careful planning, comparison-shopping and persistence are necessary to find the best deals.
If your credit rating is good, you should have no problem in negotiating a low interest rate. However, there are still basic principles, which apply during your search to find ways to save money on car loans. If you have a pile of credit card bills to pay and have made recent large purchases such as another car or a home, it is likely that your loan will have a higher interest rate. The object is to save money while negotiating your car loan.
Having a good credit report is an important asset and one of the basic requirements for saving money on car loans. You should always keep your payments current to avoid those nasty little "late" notices that appear on your credit report. It is especially important that your debts be paid on time for a few months prior to applying for a car loan. You will be asked to list financial institutions in which you have accounts, and it's nice to be able to show some savings, too. Your credit score may be reduced which could prevent you from saving money on your car loan. Your credit score also dictates the interest rate on your loan.
Another way to save money on a car loan is to have a sizable down payment or trade-in. The less money you borrow the lower your total interest will be. To save yourself from a hassle while negotiating arrangements for a car loan, it is helpful to be pre-approved for the amount of money you need to finance your car.
There are many financial institutions more than willing to finance a car for you. A reputable lender is obviously going to make some profit or they wouldn't be in the business of lending money. You can use a traditional lender such as banks, credit unions, etc., but you should also compare their interest rates with the online lenders as well.
Most car dealerships are very happy to arrange a loan for you. First, you choose the vehicle you want, test drive it and make the decision to buy it. The majority of car dealerships is honest and will gladly help you find a way to save money on a car loan. Be sure the dealer you select has a reputation for placing customer satisfaction first.
Naturally, a salesperson may want to sell you the more expensive models, but you should stay focused on your goal of getting the most for your money and saving money on your car loan.
Obtain a Car Loan No Longer Than Necessary
by: Jakob Jelling
Some time in your life you will need a new car. You may not want to have the burden of a new car debt, but you may find there are very few alternatives. There are some simple things you can look for that will help reduce the amount of money every month. Depending on your credit situation, a car loan can be very easy or rather difficult. Even though there are dealerships that specialize in selling people cars with bad credit, the purchaser must realize what they are getting themselves into.
Get the loan first
One of the greatest advantages you can have over the dealership is to get the loan before you buy the car. You can shop dealerships on weekends and at night and look at the prices and figure roughly that the car will be about 15-25% less than what the sticker says. Go to a bank or lending institution and fill out the appropriate paperwork. Once they give you the loan, you can figure out approximately how much the car will cost you in advance and apply for a blanket price. You can also sign a contract to purchase depending on financing. This means you can haggle your best price and then tell your bank or financial institution how much the car loan should be for exactly.
Dealerships do not want you to bring your own financing. This takes the deal out of their hands. Most dealerships provide finance departments who are more than willing to lend you the money should you meet their credit requirements. An average car loan can cost the consumer between 7 – 15% depending on their credit rating, financial history and ability to repay the loan. Some dealerships offer teaser rates at 0% financing. A chosen few people in the world can actually get these rates. If you are not careful, you can find yourself paying double for the car loan.
Using dealership financing
You may be pressed for time and have credit issues that make it difficult to get qualified at a bank. Your best option should you be able to get a car loan is read the fine print. You should know the exact dollar amount you are paying before you sign a sheet of paper. Dealerships can be sneaky and try to extend the life of a loan at a certain payment to get you interested. Should you only want to pay $200 per month, the car loan for five years would be $12,000. A dealership will try to finance the deal to go to six, seven and even eight years in length! That would mean a car that would cost $ 12,000 could run up to $19,200. The downside to longer payments is that the cars value could be worthless by the time it comes to buying another vehicle.
Author: Jakob Jelling is the founder of http://www.cashbazar.com. Visit his website for the latest on personal finance, debt elimination, budgeting, credit cards and real estate.
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