Did you know that 91% of US households own at least one car, and that nearly 85% of those vehicles are financed through a loan or a lease? It’s something we all have to at one point or another, but no one likes dealing with astronomical interest rates or the fees that pile up while purchasing your car from the dealership. Well, did you know that there are ways to get the rates that you deserve?
That’s right, there are ways to take charge of your loan, and make lenders work towards your best interest. There are no gimmicks, and no tricks, just a few easy tips to give you ground to stand on when looking for the best loan possible. Here’s what you can do to put yourself in the driver’s seat when it comes to your auto loan.
Your Credit Counts
It’s no secret that your credit score determines the types of rates you can get and how much you can borrow, but knowing your score beforehand is the ultimate bargaining chip when speaking with a lender. Using a site like Credit Karma, you can check on your score absolutely free of charge. This will allow you to know when a lender is offering you a deal that is less than what you deserve.
If your score isn’t exactly perfect, that’s okay! Bad credit happens to everyone, and there are plenty of ways to fix it up. Paying off any outstanding loans or bills, even monthly, before speaking with a lender can give your score the boost it needs to open up new opportunities for lower interest rates.
Skip the Dealership
The average dealership markup is 2.5%, not to mention the various fees associated with financing your car there. Skip the hassle, and look into options at your bank, credit union, or an online auto lender. The majority offer same day approval, and are guaranteed to have lower rates than any dealership could offer you.
Any lender worth speaking to will also have resources available to you such as a loan calculator, customer support, helpful FAQ’s, articles, and shopping tips. In most cases, they also offer a more personal experience during the course of your loan. Always check a lender’s reputation through either state or federal sites, or the Better Business Bureau first.
What About Used Cars?
Buying a used car is a fantastic way to save money while still owning a reliable form of transportation. Any good, reputable lender should offer loans for new and used cars alike. Many will have restrictions on age and mileage, making a little research necessary to find the best used auto loan rates.
Capital One and Bank of America, for instance, offer highly competitive rates on vehicles up to 10 years old with less than 125,000 miles. U.S. Bank is well known for keeping rates low on used cars as long as they are under six years old and have less than 100,000 miles. Auto loans for used cars are abundant, and a little shopping around will help you find the right lender for your situation.
Finding the Best Loan
Financing a vehicle can be an intimidating experience, and a major headache, but it doesn’t have to be. Knowing where your credit score stands, choosing a reputable lender, and doing a little research can go a long way in not only ensuring the best rates, but making your experience hassle free. Follow this advice and you will never fall victim to the pitfalls of an unfavorable loan again.
Take charge, and put yourself in the driver’s seat when it comes to securing your loan!
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