Most consumers know the make, model and color of the vehicle they want. What consumers usually lack is knowledge on how to finance an auto or how to get the best deal on a car loan. Here are few tips to secure the best deal for the car of your dreams.
Pull your credit reports and scores
Before you look for financing. You want to know exactly what you are dealing with before any lender pulls your credit. Any mistakes, errors or outdated information should be disputed. You want your credit report and credit score to reflect as much positive information as possible.
Window shop in person
It is best to go out and take a test drive to get the feel of the car you want. But do not allow the sales person to talk your ear off during or after your test drive. Resist the small talk and do not feel pressured to buy the car on your first visit to the dealership.
Window shop online
Before you enter any dealership be absolutely sure of the make, model and even color of the car you desire. Sales people can be very persuasive and you do not want to end up regretting this major purchase. Shopping online before you enter a dealership can help you familiarize yourself with a fair price of the car you desire.
When purchasing a vehicle start looking for financing at your bank or credit union. Financial institutions can often offer the best interest rates, especially if you are a long term customer. Banks like to form total relationships with consumers. That means checking, savings, mortgage, auto loan, credit card and possibly even retirement accounts.
In case you do not have that type of banking relationship USACarCash helps anyone to obtain financing for any vehicle throughout its Nationwide Network of Automotive Financial Lenders. They help customers secure loans regardless of their past credit history.
InstantCarLoan is another online lender that caters to consumers with bad credit. They review completed applications instantly and you can have an answer in as little as 60 seconds.
Never pay the dealer’s price
If you do not like negotiating, take someone with you who does. You can save as much as 10-12 percent off the asking price if you are willing to negotiate. It does not have to take all day. Never allow a sales person to keep you isolated in a little cubicle filling you up with beverages while they go and consult with the “Wizard”, oh, I mean finance manager.
Know your bottom line and keep in mind a car dealer’s initial offer can be marked up as much as 20 percent above the sticker price. Knowing this can give you a lot of wiggle room to negotiate a fair asking price.
Monthly payment vs. Cost of Car
Car dealers like to focus negotiations around the monthly payment of a car. Don’t even answer the question if a salesperson asks you “how much can you afford to pay monthly”. Refocus the attention towards the cost of the car and the interest rate, if you choose dealer financing.
Utilize the online loan calculators to determine what you want to pay according to the interest rate. Remember, the interest rate and cost of the car determines the monthly payment. If you have secured financing before you visit a dealership you can avoid all talk of financing and just negotiate a fair price for the vehicle.
Review all documents and paperwork
Review final paperwork before signing any contract. Be certain that all negotiations agreed upon are in the final contract. Check the price of the car, interest rate and loan term. Check the fees and costs and do not feel pressured into purchasing extra features, such as gap insurance and extended warranties.