Cheap Auto Financing
Whatever the motive- you’re ready to move on from your old whip. But, before finding your new baby, you have a pretty big task at hand: financing.
*Dum, dum dum.*
Yes, it sounds scary. Yes, it sounds time-consuming. Yes, it sounds like something that you’ll want to put on the back burner.
But, we’re here to say- Don’t. Don’t put financing off. Don’t try to find a new vehicle without knowing your options. And most of all, don’t dread it.
It doesn’t have to be as gruesome as it may seem.
Read on for our 8 must-know items before beginning your hunt.
1. Know Your Credit
One of the most important pieces of information that a financial institution will want to know is your credit history.
Your credit score impacts your financing options greatly. Having a good credit score can help you qualify for a much lower interest rate!
Sites like Credit Karma or Quizzle allow you to check your history for completely free. Sign up, review, and print off before meeting with your financial institution.
Also, many major credit card companies allow their users to check via mobile applications. A simple Google search should tell you if yours does or not.
2. Create a Budget
Another seemingly daunting, (yet absolutely necessary) task is budgeting. But, don’t worry we have some tips on how to handle that, too.
You need a plan. How are you going to pay off your loan? And, also, how much can you afford to spend?
You need to consolidate all of your monthly expenses into a single location. Be honest and upfront about your spending tendencies.
Evaluate this information and also, consider your income. How much do you have after expenses (even disposable)?
You need to understand your financial situation. This will prevent any unexpected surprises when your bills come in and you’re not as ready as you thought you were.
3. Get an Idea for What You Want
Prior to shopping for cheap auto financing, you should have an idea of the vehicle you’d like to buy. Better yet, make a list of any vehicle that’s a true possibility.
Then, research the heck out of these vehicles. Learn about their usual price and other costs associated with it.
Knowing this before meeting with a financial institution will help you negotiate rates much more efficiently. They’ll want to know you’ve done your research.
4. Get an Idea of How Much the Loan Will Cost You
So, in order to help you stay in the ballpark of your budget, find an online loan estimator. Check out sites like Bankrate.
These sites will help establish a quote for you prior to sitting down for a consultation. This will help figure out what loan options you can expect from your loan provider.
Everyone has a unique financial situation. These programs are great, as they take your own finances, expenses, and what you can afford into consideration.
5. What Other Numbers Should I Know?
Another variable your cheap auto financing institution should know is if you’re trading. A trade-in can impact your loan, significantly.
Also, you’ll want to know how much of a down payment you can make. This also impacts the total length of the loan, as well as the loan value.
6. Know the Alternatives
In the past, most of us stuck to financing through the dealership themselves. Or, we would call on their non-so cheap affiliates. Luckily, now you have many more options available.
Often, your banking institution or credit card company can provide cheap auto financing.
But, don’t stop there. Shop around at other financial institutions and credit unions. Don’t take the rate your bank offers without knowing all of your options.
7. Red Flags
There are two things in particular that you should look out for with financing options. Those are super low monthly payments and long repayment plans.
Low payments obviously seem ideal, but in reality, they’re going to cost you much more. The reason these loans are so cheap is because you’re going to be repaying them for much, much longer.
Steer clear of any loan that takes longer than 72 months to repay. You don’t want an overly extended repayment plan because that’s how interest accrues.
This causes you to pay much more on your loan than you would if you made higher payments initially.
8. Research Before You Buy
This last point is a bit of a reiteration, but it’s a point that you need to take away.
Once you settle on a vehicle, you’ll want to act quickly. Most vehicles don’t last very long at a dealership if they’re worth it.
The problem with this is it doesn’t really give you much time to go and evaluate your options. If you want to ensure you leave with your dream car, you’ll be forced to take what they offer you.
And, often times, this is certainly not the deal you want to go with. So, to avoid feeling vulnerable, get things sorted before visiting the dealership.
For Advice on Cheap Auto Financing, Auto Leasing, and More…
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