You don’t have to break the bank or ruin your financial future in order to get a car loan. Instead, use these car financing tips to get the best deal possible!
In search of a new car? Looking to buy your very first car?
Whatever it is that leads you to the dealership, you need to know a few things before you start car shopping. It’s better to walk in educated about what’s available to you and what you want rather than letting the car salesman take the lead.
You need to be able to stand your ground when negotiating and to understand what the best value on a car is, too. This isn’t as hard as it may sound. You just need to research the different cars on the market and read up on a few car financing tips.
As far as financing goes, the three main things you need to know are:
1. Fix Your Credit
You can’t expect to get a good car loan if you have bad credit. This is one of the first things a dealership will ask for when they process your paperwork. It’s how their banks decide whether or not you’ll be approved for a car loan – and what kind of loan you’ll end up with.
Good credit and bad credit can be the difference between low interest and high interest. It also plays into the length of your loan and your monthly payments.
2. Consider Getting a Cosigner
There is hope if you have bad credit and need to buy a new car. You can get a person with good credit to sign the paperwork with you.
This basically improves your standing with a dealership’s bank because it increases their level of trust with you. Having a cosigner pretty much says that if you don’t follow through on payments, the second signer will.
Of course, that’s not the best situation to put a close friend or a family member in, so you still want to avoid defaulting on payments as much as you can.
3. Put More Money Down
The final car financing tip to consider is to put more money down. This may mean you wait an extra month or two to get the car you want. But, it does wonders for you in the long run.
Putting more money down means you’ll have a lower loan to pay off. It can potentially lower your monthly payments, the extent of your loan, and even your interest rate.
Not to mention, if you’re taking the time to save for a down payment, you have extra time to build your credit even more. It’s a win-win! If you’re not sure how you’ll save the money you need, check out investment resources to help you figure it out. Here is a good one to get started with.
4. Car Financing Tips, Shopping Insights, and More!
Car financing really isn’t as intimidating as it seems – even if you have bad credit or tight finances right now. There’s still a way to get the car you need at a rate you can afford. You just have to be smart about how you save and what you buy.
For more car financing tips, shopping insights, and other words of automotive advice, click here.