Tag Archives: rating
Car Loan Information
Dealing with a car loan can be quite the headache, but here are some things that everyone needs to know.
First, a car loan is a long-term commitment. Many dealerships are now offering car loans that are 72 months, 78 months or even 84 months long. Thats between seven and eight years, a lot longer than the average person intends to keep a new car when they purchase it. Since even the best warranties in the business are generally 60 months (five years) bumper-to-bumper and 10 years for the power train only, chances are that this car is going to need major maintenance and repairs long before the car loan is paid off. This is important in planning your budget around your car payment, so that even if the car has a great warranty, you are saving for those upcoming expenses.
Second, your credit rating will affect you car loan. This seems obvious, but many people have not considered it when they go shopping for a new car. Advertised interest rates of zero percent or cash-back financing are often only available for those with the best credit ratings, so shoppers should not expect a car loan at those rates.
Once you understand that your credit rating is going to affect your car loan rate, it makes sense to get a copy of your credit report or at least know your credit rating before going shopping for a car loan. This allows you to anticipate any issues the financier might have with your credit and gives you the knowledge you need to deal with any objections to your loan application.
Some unscrupulous loan officers might try telling uninformed buyers that their credit is too bad for standard financing and offer loans for people with less than perfect credit. Knowing your credit score can help you counter these types of people.
Third, your bank or credit union may be able to offer you a better car loan than the car dealership. Given the length of the commitment to this loan, it makes sense to shop around for the best loan available, but most people walk into a dealership and let them handle the financing. The dealership is not in the business of getting you the best car loan out there. Thats your job.
The dealership is interested in getting you a car loan, but they do not care if it is one that is good for your financial future or not. So, it is important to shop around yourself for a car loan and find the best rates. Often, this will be with your bank or credit union where people are familiar with you and your credit, but it might also be with a national lender.
One word of caution: applying for a car loan via several lenders could temporarily lower your credit rating. Any time a person applies for multiple new lines of credit there can be a short term lowering of their credit rating while the system figures out that they did not in fact open up that many new debts.
Finally, the most important thing to be aware of when getting a new car loan is to read all the fine print. Unfortunately, many people believe loan officers when they say that it is a standard for and that they dont need to read it.
While it is a standard form to them and they may not be deliberately misleading you, the reality is that you do not sign car loans every day and some small print which they regard as standard might be important to you. Read every word and then make the right choice.
New Year Auto Loan Tips for People with Bad Credit
If investing in a car is in your group of “things to do” this New Year, the first points you should think about is your personal credit score and score. Is your credit rating sufficient to win an auto loan lenders approval? Is your credit ranking in good condition? Consider these practical tips on ways you can get approved for a good car loan deal to finance your car purchase.
Order your report. Consumers are entitled to receive one free copy of credit rating from each three major credit agencies annually. The start of the Year is the perfect time to take advantage of your consumer right, particularly if you plan to get a car loan.
Its a smart idea to check your credit history at least two months in advance before you apply for a car loan or any kind of loan or even a credit card. Carefully examine your report plus in case you find errors, send a letter of dispute to the bureau that issued your report. Disputing credit score errors can take approximately Thirty days which is why you must do something perhaps 30 days just before submitting your credit application.
In case your dispute applies, the errors shall be corrected. The bureau will send you an updated copy from your credit rating without cost. It may even notify the two other bureaus with regards to the updates made in your credit report. This step can instantly increase your credit scores by a few points.
Save a greater down payment. If you have already a bad credit score, expect to provide a higher advance payment. You should be able to save from around 20% to 25% down payment. By performing this, you’ll be able to significantly decrease the rate of interest within your car loan and lower your monthly auto loan payments.
Compare auto loan deals. Be able to spend more time exploring the market and comparing loan deals offered by various auto loan lenders. In case you have a good credit rating, you may surely get approved more quickly and have access to the top deals.
Additionally, bad credit ratings might be a major disadvantage because most lenders reserve their very best offers to customers with impressive credit rating. Is it possible that you should delay your car purchase until your credit rating improves? If so, then you will be in a better position to obtain an auto loan also to negotiate with a potential lender.
What if waiting isn’t a choice and you also have to obtain a bad credit car loan? You need to more cautious in evaluating car loan deals since you might encounter unscrupulous lenders which are seem to make the most of your position. Avoid getting scammed or tricked by checking the interest rate, the fees, the terms and conditions. Check the standing of the lending company and assure that you are handling a legitimate and trusted lender.