4 tips to get the best possible deal on a car loan
There are American, British, German, European, Japanese, and many other incredible motor vehicle brands around the world. They don’t make it easy to narrow down your options and make a choice.
But once you find something in your range, you need to tackle another problem, financing. You might already have an ideal interest rate in your mind, but you need to remember that you might not get your desired figures.
If you are looking into the wrong companies, you might even need to look for a cheaper ride. But since you have your heart set on a beauty, you should follow these four tips and get her as soon as possible.
Check your Credit Score
You might already have an ideal APR in your mind, but it might be entirely unrealistic. The only way you can know is by seeing your credit score.
You should get a report from all the major credit reporting agencies that give it for free. The reason why you need all of them is that you don’t know which one your lender is going to use. After you know your score, then you can determine the rate of the loan you can get. That would directly influence your monthly budget.
But not only that, some lenders might even use a fake report to increase the rate and charge higher. Having the credit reports allows you to leave that place immediately.
You also need to look around before settling on a car loan.
With your budget and credit score in mind, you should now be ready to start looking around for loans. But since they might not significantly vary, you can stop looking after visiting four or five places.
If the dealership is offering the option, then you can check with them. But many people find their rates to be higher than banks or other lenders. That is why you should check lend for all, as they might be able to give you the best APR.
Don’t Refuse Down Payment
While most lenders will require you to put down at least 20% or 25%, others might give you an option. This is where many people completely turn down the opportunity to put down a down payment.
However, you need to put down the most substantial down payment you possibly can on the loan. The reason is that it can significantly reduce your monthly payments and the total amount. Overall, you might end up saving a few hundreds of dollars, or more.
Select the Shortest Possible Term
Nowadays, you might see options for seven, eight, or even nine-year-long loan terms. They are very appealing to some people because they can reduce the monthly payments on the loan.
But you should choose the shortest possible term. The reason is that the longer the term, the more total cost you have to pay. It might seem less on the monthly, but it gets more in total. Also, you will be stuck paying off debts for a much more extended period.