Buying A New Car? Use These Tips To Get The Best Terms On Your Auto Loan
Making the decision to purchase a car is not always easy. With the price paid for new vehicles being second only to the family home in terms of cost for the average household, devoting some extra time and attention to the process can result in a significant savings. In addition to the selection of the vehicle, however, shoppers will want to also look for ways to get a better deal on the auto loan they will use to make the purchase. If you are currently shopping for your next vehicle, or planning to do so in the near future, you can use these tips to help you get the best auto loan terms, too.
Find the car first, then shop for the auto loan
Car lots love to provide in-house financing, and they profit from doing so. In some cases, their terms can be worth considering, such as when they offer zero interest rates or other significant benefits. In many cases, however, you may be able to find a better deal with your local credit union, bank, or another auto loan provider who is not associated with the car lot or manufacturer. Spend some time finding the right car first and once you have made the best deal you can, push pause and begin to actively search for auto loans, while remembering to always compare all options carefully.
Have all the facts before shopping for an auto loan
Auto loans qualification processes rely heavily on consumer credit histories to determine credit worthiness and the actual interest rate of the loan. Before beginning to shop for any auto loan, make sure you have obtained a current copy of each of your credit reports from all three agencies and reviewed them for errors. Consumers are allowed to obtain these reports for free once each year from the three main credit reporting agencies - Equifax, Transunion, and Experian. If an error is present on any of the reports, taking time to clear up the problem is an excellent way to help you qualify for an auto loan with better terms.
Play one lender against the others
Once you have quotes from at least three lenders, work strategically to improve the rates and terms you have been offered by showing each lender what the others are offering. Banks, credit unions, and other auto loan providers are businesses, too, and want you as their customer, so they are often willing to make a better deal to win your business.