When it comes time to shop for a new car it can be a shock. Cars, even used cars, cost a lot. Most people do not have the money to buy a car so most of the time they have to get a loan. You should already know that you want to get the best interest rate on a loan but you might not know how. It is simple to get the absolute best car loan rates but there are a few tips that can help.
Getting the Best Car Loan Rates
Do not get taken in on the zero or near zero loan advertisements. They are only a way to get you in the door and slap you with a higher price tag or higher fees. Like everything in life, if it is too good to be true then it probably isn’t. A car dealer that advertises those crazy low car loan rates is fishing to get you in there and get you to sign without looking at the fine print. Balloon payments at the end of the loan period are just one of the ways you might get burned by those “deals”.
Before you ever even step into a car show room you should check your credit history. Even if you think you have perfect credit there could be something on you credit history that raises a red flag to a lender. There could even be fraudulent activity on your credit rating and you do not want to find that out the hard way. Make sure that your credit rating is in good standing that way you have the maximum bargaining power when it comes to getting the best car loan rate.
You will also want to save up a deposit. The more you have to put down as a deposit on a vehicle the less risk the lender is taking. Make sure to bring in your residential histories and bank statements to help your case for having more assets so you get the best car loan rate.
Buy new. A new car is seen as less of a risk to a lender therefore you will get a better rate. If you cannot afford a new car then get a near new or dealer certified car. The newer the car, the less risk for the lender.
A broker can work for you and scout out the best deals on car loan rates. Brokers do make a percentage but if they can find you a better deal for your car loan rate it could end up saving you a bundle in the long run.
Buying a car is a big purchase so do your homework and use these tips to get the best car loan rate possible.