Purchasing a vehicle is a necessary purchase depending on where you live we all have places to go and a car would be helpful to get you there. Many people that currently buy new cars and used cars are making the mistake of shortening the process.
Yes we know that you can just go to the car dealership that’s local for you that’s honestly the best way to do it but it does help to take your time and do some consumer research on the vehicle. You want to know how the financial pieces of buying a car come together. We will share with you the process of auto financing.
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What you need to know about auto financing
- Set a budget that’s a good starting place you may want to have a little wiggle room but try to stay firm to that number. Setting a budget will help you avoid costly mistakes in the future. Know the difference between what you can pay and what you should pay for a car. Go through your finances and figure out what your willing to spend on a car total that also includes, down payment and monthly car payment. Set your limits on spending for the car.
- Your credit score does matter and will help you get a low afford auto loan rate so don’t ignore what you can do to help your credit score. If you have a great credit score dealers are never going to let you pass up a car deal that you deserve. If your credit score is low they may throw you one of the worst car deals and make it seem like you can’t negotiate with them. This is why its best to work with the proper car dealership near you no matter if your in New York or Los Angeles you want work with the proper car dealer in Los Angeles that can work with credit score to get you financed. Understanding your credit score means that you are aware of the auto loan rates you can get even in places like New York. Not all car loan deals that your car dealership advertises is for everyone and knowing where you stand with your credit will allow for you to know when and how to go about getting car financing that works for you.
- Remember this that your car is not an asset. Cars lose their value quickly. A new car as soon as you drive it off the lot loses about 10% of its value. Understanding that cars are not assets or even an investment but paying on a new or used car is a liability is best. So you want the mind set to stay within what you can afford. Really you don’t want to be upside down on a car at any point that you have an auto loan. You want the car to hold its value even after the auto loan is paid off.
- Take a short term loan out on the car so what we mean is don’t takes a 10 year auto loan out for the vehicle because the monthly payments will be the best its a bad idea. Try and take a three year auto loan or five year auto loan tops and pay off the car. Your payments might be high but you’ll save on the interest paid and have a debt free car faster. When buying a vehicle you don’t look at the monthly cost you look at the total your paying for the vehicle. That’s how your going to find out if you got a good car deal or not.
- Your down payment should be at least 20% of what the car price is. You may find a car dealership near you that offers $500 down on a used car or maybe $99 down on a used car but you should really look at why its important for you to put at least $1000 down on a used car if your looking at financing. The more you put down the more your helping yourself with lessen the amount you have to borrow. If you put 20% down that is often the “sweet spot” for the best auto financing car deals and lower rates.
- You can pay the financing requirements in cash. Whatever you don’t pay in cash you might be paying interest on. Dealers pay the sales tax for you but they can roll that into the auto loan and then your paying interest anyways. Use your down payment to pay all the taxes and fees so you don’t get charge anything. Not doing this will only add interest to your auto loan.
- Look at your refinancing options if you have already purchased a car with terms that don’t benefit you? You should be able to easily refinance the same way you refinance a home. This can be easier if your credit is good and the car is in good condition. The process goes as you request refinancing from the auto lender near you.
- You can compare auto loan rates online, the rates may vary from lender to lender. Car dealers can also have their own auto rates on the vehicles they have they can act as brokers for the lenders. To get the best auto loan rates in your area we suggest that you shop around and get quotes. Its best to walk into a car dealership with some auto loan rates in arm this way you can have better negotiations for cars. Just don’t go into the car dealer blind and unaware that’s how deals get you.
- Be prepare with all the paper work in hand. Being unprepared is not a good way to start of strong negotiations. If you don’t know your credit score, or income details this can hurt you with car buying the car dealership will have the upper hand on you. Have the proper paperwork to talk numbers doing this will allow you to accept a good deal from the car dealership if one is offered.
Financing
Simple financing for vehicles with bad credit.
New Vehicles
Auto loans for bad credit or poor credit.
Used Vehicles
Auto loans for bad credit or poor credit.
Auto financing can take some time
Auto financing may take some time and patience and having all the paper you need to make the best informed decision. The goal of buying a car no matter what is getting a fair or good deal on the vehicle and not leaving money on the table.
If you follow what we have laid out for car buying your next car purchase should be a little easier.