Tips on finding the best new car loan

By | August 9, 2018

Buying a car is exciting. It’s usually far more exciting to buy a car than it is to finance the car. However, finding the right financing for your car purchase can save you thousands of dollars over the life of your loan. That is why it’s very important for you to know where you can find the best new car loan. This article offers some tips to help you get started.

The first thing you need is a budget. Don’t buy more car than you can afford. You need to decide whether a used car or new car is better for you. You will also need to choose between buying a car and leasing one.

When shopping for auto loans, you should know your credit score before you start shopping. The more knowledge you have about your credit situation, the less likely you will have a finance officer stick you into a worse auto loan than you deserve.

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Auto loans are offered by different sources, such as banks, credit unions, and the dealers’ own finance arms. Make sure to shop around, so you get the lowest interest rate and a payment you can afford.

Dealer Financing

Dealerships often have promotions they use to sell cars. Sometimes, the promotion may be tied to the interest rates offered on the car loan. For the past few years, there have been numerous promotions that offered interest rates as low as 0% for the life of your loan. However, most borrowers do not qualify for the 0% interest loans; these promotions are usually reserved for borrowers with immaculate credit.

Bank or Credit Union Loans

If you have a relationship with a bank or credit union, check to see what kind of auto financing they will offer you. Sometimes, if you have a good banking relationship with your bank, you may be eligible for a customer loyalty loan that comes with much better interest rates and terms than the other loans you’ve looked into.

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Online Lender Sites

There are many Web sites on the Internet that serve as lender portals for lenders looking to make car loans. These sites have you fill out some personal information and then submit your information to several different lenders. The lenders then compete for your business by offering you a loan based on the financial information you provided. This can be a great way to find the best new car loan. You can browse through the offers you received and compare them to each other. Once you’ve found the best offer online, then you can compare it to the loans you’ve found elsewhere.

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Summary

While the best interest rates are restricted to borrowers with excellent credit scores, the process for finding the best auto loan is the same for all borrowers. Compare the loans that are available from the dealer, from a bank or credit union, and through online lenders and choose the one that offers you the best deal. If your credit rating is a barrier to finding good financing, take the proper steps to improve your credit.