When it comes to getting a car loan there are many factors that go into getting the best price. From credit scores to payment histories as well as going to the right dealer, there are so many little pieces that make up the big picture. Many times if you aren’t educated on what to ask or look for you can end up being screwed. Thankfully, we’ve done the homework for you and have found four excellent tips to be sure you can get the best car loan rate possible.
Keep An Eye on the Total Cost
It’s important when you are comparing loans to be aware of the total cost and not just the APR which can vary from day to day. You want to make sure that you find a lower rate as it can create long-term savings especially if your car loan is an extended one. This leads to another important factor of the term of your loan. While a longer loan can produce smaller payments you will end up paying more over time than if you get a shorter term with higher payments. A three year loan costs WAY less than a five year loan so keep that in mind before signing the dotted the line.
Shopping for an Auto Loan
While going to the dealership with a pre-approved loan can give you some bargaining power, it also helps you when it comes to vehicle pricing and financing costs. Walking into a dealership with no loan and hoping for the best is a sure way you are going to overpay. We recommend going to www.bankrate.com when searching for an auto loan as this site shows you the average loan rates nationally.
Shop Around and Save
You would never go for the first car you see on the lot so why should the same be for your auto loan? Always shop around with different lenders to see what rates are being offered. If they are consistently the same, then you know it doesn’t matter who you go with. However, if they are vastly different you might want to find out why but who offers the best benefits overall.
Know Your Credit Score
The truth of the matter is your credit score effects your purchasing power. If you have a history of bad debt you can expect a smaller loan and a higher APR. If you’re credit is in good to excellent standing, you will have way more options to chose from when it comes to lenders and vehicles. We always recommend getting your score from the top three sites: TransUnion, Experian and Equifax as the score can vary from site to site.