3 Common Car Loan Mistakes Oct 25, 2011
Low Interest Rate Car Loans Nov 29, 2011
Tips to Improve Your Credit Score Nov 4, 2011
Car Loan Fact:
Each payment you make for your car loan has two parts, an interest portion and a principal portion. The interest is the fee you pay the bank for the loan, and the principal is the balance of what you owe.
1. Don’t negotiate the monthly payment. Negotiate the price. Buying a car based on the amount of the monthly payment is not in your best interest. Sure, you should know a rough figure of what…
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Unless you’re paying cash, once you’ve selected the perfect vehicle for you, you have one more hurdle to overcome – financing. There are several methods for obtaining the funds for the purchase of your car, from working with a local bank directly to taking out a line of credit against your home. However, most people work with their dealership to get their car financed. Following are four reasons why many car buyers get a car loan at the dealership.
1. Manufacturer financing. Your local car dealership has access to special manufacturer financing rates that are often significantly below prime lending rates available at other lenders. These “teaser rates” can save you thousands of dollars over the life of your car loan. Car manufacturers offer these types of financing incentives as promotional events to drive sales. These special low interest rates are often available to buyers with good to excellent credit.
2. Financing options beyond traditional car loans. Getting a car loan at a the dealership doesn’t mean you have to simply settle for a traditional car loan. Instead your car dealership can help you with alternative financing options. Leasing a vehicle, for example, can allow you to drive a more expensive vehicle, for a lower monthly car payment than if you would get a traditional note. Balloon payment types loans are also an option many dealerships can arrange. Like a lease, this can help you drive a more expensive car for a lower monthly payment.
3. Lower interest rates from local banks. Even if you’ve been at your local bank for years, chances are you do not have the financial clout of a car dealership. For this reason, local banks often compete for a car dealership’s business, offering slightly lower interest rates than they offer customers who come in directly to the bank.
4. Poor credit options. If your credit is less than stellar, getting a car loan through a dealership may be your best option. Financing institutions often are vying to do business with car dealerships. For this reason, the dealership’s finance manager may be able to get a customer with poor credit financed through a bank who would normally turn them away, simply because that bank would like to do more business with the dealership. In addition, dealerships often have several financing avenues devoted specifically to customers with bad credit.
Whether you’ve just turned 18 and starting your credit history or have simply been able to live debt free for many years, the result is the same – no credit. Getting a car loan with no credit can be even more challenging than getting a car loan with bad credit. However, it’s not an impossible task. There are several ways you can improve your chances of getting a car loan with no credit.
A co-signer, with good credit, is probably your best bet for getting your credit history started, when you have no credit and need a car loan. This is often how many younger car buyers get started, with a parent or guardian co-signing for them. If you don’t have someone who can co-sign for you, then you will want to start with a small credit card.
Although this will mean you won’t immediately be able to purchase your car, there are several credit card companies that offer low limit credit cards for new credit consumers. Make your credit card payments on time, and be sure not to max out your card, and you’ll find your credit score growing nicely. There are several resources for monitoring your credit score, so you can keep track of it.
If you really need a car right now, and can’t wait to build your credit score, you may want to talk to a buy here/pay here dealership. There are a number of car dealerships that handle their own financing in- house, and often work with no credit car buyers. You’ll likely pay a higher interest rate at this type of dealership, but it can be a viable no credit car loan solution. Look for a dealership that reports payments to the credit bureaus. In this way, you’ll be building your credit score and can even look at refinancing your car loan, once you have a solid credit history, at a lower rate at a traditional bank. You can get a car loan in Chicago from several dealerships that are willing to work with you.
Whichever option you choose, one thing is critical – always make your payments on time. In this way, you’ll be on your way to building a strong credit history that will help you not only buy your next car, but also likely the home of your dreams.
Buying a new car can be both exciting and stressful. You can decrease the stress that comes with car buying by ensuring you get the best new car loan for you. The best car loan can mean saving you thousands of dollars in interest fees and help make the car of your dreams more affordable. To determine which new car loan is best for you, you first have to understand your options for new car financing.
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Purchasing a car can be one of your most expensive purchases you make in your life. If you’re like most people, buying a car also means getting a car loan. Your car loan can significantly impact the total cost of your vehicle. Following are three tips to consider before getting a car loan.
1. Compare car loan interest rates. The interest rate you pay can vary dramatically. Car dealerships often work with both local banks and manufacturers for financing. Manufacturers may offer special financing incentives that can lower your car loan interest rate. However, your local bank or credit union may have attractive rates as well. Even a home equity loan can offer low interest rates, plus possible tax incentives. Do your research and compare interest rates from several sources, before you commit to where you are going to get your car loan.
2. Get your loan commitment in writing. When you find an interest rate you’re comfortable with, get the commitment in writing. Until you get the loan terms in writing, don’t count on the rates. Sometimes sales people at dealerships quote interest rates before they’ve taken into consideration your credit score or other facets, such as your down payment or terms you are looking for. Even if a lender tells you that you are pre-approved, you may not get the financing they’ve mentioned.
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Leasing your new vehicle offers several benefits. The primary benefit is a significantly lower
payment than if you were to purchase the vehicle. For many buyers, this allows them to drive a
more expensive vehicle than they’d normally be able to afford. However, the leasing process can
sometimes be confusing, due to the verbiage financing managers use. Following are the most common
terms you’ll hear when leasing your car. Once you’ve familiarizes yourself with these terms, stop by
AutoLoansOnDemand.com to find the perfect financing option for your car!
Amount Due at Lease Signing – This is the amount you will need to pay when you lease your new
car. It typically includes a security deposit and other fees. This is sometimes referred to also as “up-
front costs.”
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When buying a car, it’s not just the price of the car that affects the cost of ownership for your vehicle,
but also the financing rate you get on your car loan. There can be significant differences in the rates
offered from lender to lender and CarCreditInChicago.com wants to help you get the best rate possible.
Following are five steps to take to get the best rate on your next car loan.
1. Know your credit. Before you head out to the dealerships, get a copy of your credit report.
Double check that all of the information is correct on your report. Errors can negatively impact
your score! If you find mistakes on your report, contact the credit bureaus right away and have
the errors corrected.
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What Are the Differences in Financing Sources for Auto Loans? Why should you pick one over the other? Read more
Chicago-area car buyers are nothing if not savvy. You work hard for your money, and want the most for it when you spend it. This is especially true when Chicagoans shop for a new or pre-owned car. However, getting a good deal goes further than getting a discount off the car’s sticker price. Getting the most for your money when making a vehicle purchase also means getting a low interest rate car loan that Chicago shoppers can use to save money on the life of the loan for their new car. With a lower interest rate, car buyers have a lower monthly payment, plus they pay less interest over the term of the car loan.
If you’re like many Chicago area car buyers, your credit score may have suffered over the recent years, due to the challenging economic times we’ve all faced. The good news is just because you have a bad credit rating now, it doesn’t have to stay that way. If you are looking to get a loan in the future, you will need to learn to improve your credit score. The following are tips to improve your credit rating.
Buying a car based on the amount of the monthly payment is not in your best interest. Sure, you should know a rough figure of what you can afford each month, but you shouldn’t negotiate that with a salesperson. Instead, try to minimize the different pieces of the car buying process such as how much for your trade in, the price of the vehicle, and financing.
3 Common Car Loan Mistakes Oct 25, 2011
Low Interest Rate Car Loans Nov 29, 2011
Tips to Improve Your Credit Score Nov 4, 2011