There are dozens of online reviewers who provide insightful guides on the performance of new cars hitting the market. Before committing to buy any car under a loan arrangement, take care to establish if you will get value for money by going the credit route. As always, ensure the reviews you rely on are detailed and completely objective rather than depending on marketing drivel posted by the car manufacturers themselves.
9. Always Keep In Mind The Car’s Actual Price
Always Keep In Mind The Car’s Actual Price
Do not be boxed into a corner by a dealership selling cars through credit arrangements and then end up paying far beyond the prevailing market value. Look for pricing tips from reputable auto sites and compare them with what you are getting for the car under financing arrangements.
8. Look For And Insist On Flexibility
As a prospective car buyer, you are well advised to start looking for good new car loan rates from established financiers and dealers early enough. A loan which seems great today may become intractable in the future as your financial situation evolves. It helps if you can get a car loan deal which allows you to pay extra each month and also one which allows you to pay off the loan early without saddling you with penalties as a result.
7. Consider Each Transaction Distinctly
If you are trading in your current car as well as arranging financing through your car dealer, it is likely to lose sight of the nitty-gritty of the deal. In order to determine if you are getting a fair deal, tell the dealer to unbundle the complete offer to distinct transactions. Once you take a good look at the purchase price of the new car, the financing terms and the trade in value of your old car, you will be able to determine if the entire deal is worth taking or not.
6. Do Not Let Enticing Offers Lead You To Buy A Car You Cannot Afford
The beauty of buying a car on loan terms is that you can enjoy the benefits of a high quality car without parting with the money it is worth at a go. Some people tend to interpret that the option of getting a car on loan is virtually a license to spend beyond their means. This is not the case at all. The best personal finance guidelines stipulate that you should never spend more than 20% of your disposable monthly income paying off a debt such as one incurred in buying a car.
5. Dealer Financing Is Not All It Is Touted Io Be
The emerging trend where the car dealer also arranges the car loan seems to be gathering pace in recent years. However, many car buyers forget that the dealer is always a middleman in a transaction involving a financier. Even with zero interest offers, it is likely you will have to make a hefty down payment first, often to the tune of 25% of the car’s showroom price before you can qualify for dealer financing. Moreover, your credit rating must be top notch for such a deal to sail through smoothly.
4. Compare Different Offers
Even if the very first offer you get as you seek for a preferential car loan deal may seem custom made for you and your present financial situation, it is always worth looking for alternative offers. There are websites dedicated to the enterprise of offering comparative listings on companies dealing with car loans. Though ultimately the best offer will come after you talk personally with the person authorizing the loans, this preliminary comparison can do no harm.
3. Do Not Be Tempted With Long Term Loan Offers
It is becoming increasingly common to find offers of new car loan rates spread over a long period of time for the borrower to make repayments. Car dealers finds this approach attractive as specifying six or seven year repayment periods seems to coax prospective customers to take a bite more effectively. It would however be a great mistake to take a car loan on such terms, no matter how low the monthly repayments are. There is a very high likelihood that the car will have depreciated massively in value before completing the loan repayments, leaving you paying for a car you don’t use or want. Moreover, it is likely that all the manufacturer’s warranty guarantees will run out in three or four years.
2. Know Your Credit Rating
Though auto loans are often considered as high risk ventures, it still pays to keep your credit ratings optimal. By ensuring you have the good enough ratings by the ratings bureau, you will be guaranteed preferential terms as well as manageable repayment terms. Many financiers with preferential new car loan rates often consider good credit ratings of applicants as the most important factor as they seek to approve or reject loan applications. Fortunately for you can get your credit report, detailed and up to date, online so you can know if you are bargaining from a point of strength as you submit your application.
1. Do The Math Yourself
It pays to remember that car loan companies package their deals in a way to draw the biggest appeal from would-be car buyers. Often the less unsavory aspects of the offers do not come out in the figures they print on the brochures. Some drivers confronted with an offer touting a zero interest loan offer and another promising a rebate. It is tempting to assume that the zero interest loan is the best but by checking the small print you may find that the deal is actually not worth it.
