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Get The Best Deal On A Car Loan With These 5 Tips

by pps-DUEditor

Check Your Credit Report

Visit annualcreditreport.com and get a copy of your report from all three major credit reporting agencies – Experian, Equifax, and TransUnion because your lender is likely to use one of these. Check your report and correct any mistakes in it. Check your credit score, too, because the loan terms will depend on your score.

Shop For The Best Rates

Visit credit unions, community banks, and large national banks and enquire about their terms for auto loans. The super-low rates that dealerships advertise are only offered to customers with excellent credit scores. Remember that before you walk into a dealership. So, apply for a loan, set it all up, and if the dealer beats the offer, go with the one that’s better.

Choose The Shortest Loan Term

Cars have become more expensive, and loan terms have become much longer. But the longer the loan term, the more you pay as interest despite the lower monthly payment. Ideally, your car loan should not be longer than 48 months. It’ll mean a higher monthly payment, but you’ll be debt-free sooner.

Beware Of The Yo-Yo Scam

You sign the papers, get the keys to your new car, and drive it home to celebrate assuming everything is done. A few days or weeks later, the dealership calls to let you know that they weren’t able to get financing approved at the rate you agreed upon. So now you’ll have to return the car, pay a hefty per day rent for it, and lose your deposit and trade-in amount unless you agree to a new higher-interest loan. Most people agree to the new terms when faced with this. So read all the fine print, and don’t drive the car away until the financing is finalized. Better still; arrange the financing from somewhere else.

Ignore The Monthly Payment

Always negotiate on the final price of the car. Salespeople can manipulate low monthly payments to ensure you pay more over the long term. The ideal thing to do is get pre-approved for a loan.

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