Low Interest Rate Auto Loans - 5 Tips For Finding Lowest Rate
Low Interest Rate Auto Loans - 5 Tips For Finding Lowest Rate
Oooooh, how good it will feel to slide yourself into the front seat of your new car. Will it be a leather seat? Maybe suede? Will your steering wheel be made of polished wood? Or, maybe a durable titanium alloy? Will you choose satellite radio and a GPS system or stick with the basics?
It is a lot of fun to fantasize about your next car: how it will look, how it will smell, how it will feel to drive it, how the engine will sound - and how good YOU will look driving it. To make the fantasy a reality, you will need to figure out a way to pay for your new dream automobile.
For most people, auto loans are the way to go when buying a new or used car. Here are some tips on getting low interest rate auto loans:
Tip 1: Choose The Right Car For Your Budget
The basic principle in auto financing is: the less you borrow, the lower your monthly payments will be. It is also true that the less you borrow, the better your chance of getting approved for an auto loan, especially if you have a bad credit score (below 600).
In order to get the lowest interest rate loan, it helps to buy a car that is well within your budget. So, while your dream car may be one thing, you may still be able to find a beautiful car that meets your needs while saving you tens of thousands on the sticker price.
Tip 2: Know Your Credit Score
Before approaching an auto loan lender, be sure to research your credit score. Run a credit report with all of the major credit bureaus (TransUnion, Equifax and Experian) and get your score from each of them. Knowing your score ahead of time will put you in a better position to negotiate.
Tip 3: Save Up For Your Down Payment
Going back to the basic principles of auto financing: the more you can afford to put down for your loan, the lower your loan amount will be. A smaller loan could also help you qualify for a lower interest rate. And, of course, putting more down now will lower your monthly payments.
Tip 4: Create A List Of Low Rate Lenders
Now it is time to start contacting lenders. Do online research and create a list of at least 5-10 lenders. Remember, more lenders means more choices.
Tip 5: Negotiate By Never Accepting First Offer
Once you start applying with each lender, you will get various offers. Even for the lenders who offer you the very lowest rates, remember to never skip the step of negotiating. The best and easiest way to negotiate is to reject the first offer they give you. It can't hurt - and it could prompt them to offer you a lower rate.
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