So you’ve decided to buy a new car. Congratulations! But now you have to decide how you’re going to get the financing, and with all the available options for your auto loan it might seem like a daunting task. Where do you start? The good news is that we’re here to help. Read on to learn about how to find the best auto loan out there and drive your new car home with peace of mind.
The first thing you need to do is figure out how much you can afford to pay for your new vehicle. You can start by determining how much you are willing to pay each month, and then use one of the calculators that are available online to figure out what your dream car price can be. The loan’s interest rate will influence that amount, so visit some online banking sites beforehand to know what the current interest rates are like in the market.
Shop for the Best Loan – Separately From the Car
Now that you know how much you can afford to pay for your new vehicle, you will naturally want to start shopping for your dream car. But you have to keep in mind that even if the dealer offers financing, you might be able to get a better deal by shopping for your auto loan separately. You can get a preauthorization for your loan (many institutions offer online services) and walk in the dealership with the money you need for the car. Who wouldn’t like to have one less point to negotiate with the dealer?
Find Your Auto Loan
There is no secret in finding the best loan: you have to contact different financing services and see which one offers the best interest rate. People usually tend to start with their bank, since they already have a relationship with them and expect to get a rebate for being loyal. While this might be the case, don’t be afraid to do some research and look into third parties. There are now online services that offer financing and preauthorization at the click of a button. If your credit score is good, your interest rates may be lower with them. Whatever you do, when speaking with your credit representative, make sure to let them know you are shopping around and negotiate your interest rate. In the long run, it could save you a lot of money!
Research Your Credit History
You have to know that some other factors come into play when it comes to interest rates. Sure, the down payment and length of the agreement will have an influence – the shorter the term, the lower the rate – but your history is important as well. If you have a clean credit report and a high credit score, financing institutions will see that as a lower risk loan and will therefore be willing to give you a better interest rate. Get to know your credit value and use it to your advantage!
By doing your research and treating your auto loan shopping as a task on its own, you can truly manage to get the best loan to get you behind the wheel of the car of your dreams. Don’t forget to look at all factors that could influence the interest rate and don’t be afraid to negotiate. You’ve worked hard to earn all that money, and there’s no reason to just give it away.