Interest Rates On Automobile Loans

by Thulas Sukati

When you are next looking to buy a car then funding will be an issue so you would be wise to seek out an auto loan to pay for it. If you haven’t used a loan like this before, it is a great way to fund a car because it is secured by a lien on the vehicle being purchased,as the balance is gradually paid off, the amount of credit at risk decreases. Your choice of vehicle is of course dependant on how much you will be allowed to borrow so you will need to do some careful searching on the internet if you want to find a quality vehicle.

The best way to search for a car is using the many online services now available which speed up the search tremendously as all you need to do is enter the type of car and budget and the search engines can do the rest, all without leaving your home. You can also look for a more up-market car than you would ordinarily be able to buy if you are happy to settle for a used version perhaps only a few years old. Auto loans are available to everyone provided their credit rating is clean, therefore, before making that application, carry out a search to make sure yours is ok.

If you credit history is ok then fine but if there are errors, then this is the time to have them rectified as you may find the loan interest rate is ‘loaded’ against you when it is approved. For the best possible interest rates, your credit score needs to be over 550 otherwise penalties may be incurred. Most finance institutions are able to supply an auto loan but the rates will vary as will specific terms so it is best if you shop around for the best rates and don’t forget to use the internet!

A number of different finance packages will be available but bear in mind the total amount payable when you look into this and not just how much the monthly premium is. Do not fall into the trap of believing that the lowest monthly repayment is going to be easiest in the long run as the overall loan cost will probably be greater. Having insurance can also help you to get a better deal sometimes although it is not necessary,the finance company does not have the same risk if protection is in place, should anything happen to the borrower.

If you are getting additional rebates in exchange for you financing through the car dealer, then you should take their car financing deal,however, there is nothing stopping your from applying for finance at a lower interest rate online once you have received the rebate. Many lenders exist and often charge for arranging a loan, including a down payment but two online companies do not: Capital One Auto Finance and E-Loans. Some dealers will even match the quotes with those that are supplied by online lenders so you may be able to negotiate with the car dealer directly.

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