This is a guest blog article by our partners at myautoloan.com. Readers of our blog can apply for an auto loan and get free quotes in minutes.
Auto Purchase & Financing - Tips and Advice
If getting competitive auto financing is confusing to you, you are not alone. Lots of people are intimidated by the prospect of going to a dealership and buying and car and getting it financed. Then there’s negotiating price and all the back and forth with the salesperson and their manager. Wait, you’re not done yet. How are you going to pay for it? What interest rate might you get approved for? What about the loan term and any other conditions required? Is the dealer making money on the financing that you’re not aware of?
Whether it’s an aggressive dealer sales team or general overall lack of customer experience in buying cars and negotiating financing, consumers are looking for unbiased information, tips, and advice. To help ease the auto-buying experience, here are some tips and advice to save you money and help you.
Did you know you can get approved for a loan before you visit the dealership? Securing your financing before you visit the dealership empowers you like a cash buyer! Where and when you decide to purchase your new or used vehicle is up to you. Think seriously about financing options before you shop! Once you determine how much you can afford and/or borrow, you can decide what type of car, SUV or truck you want to purchase. Follow these financing tips to get the best deal.
1. Know your credit score
You really need to know where you stand when it comes to your credit profile which consists of your credit report and credit score. It’s free at www.annualcreditreport.com and you can get it from all three credit bureaus.
2) Decide where you want to obtain financing
Everything you know since the last time you bought a car is old school. Find an online direct lender with a BBB rating of “A” that is a licensed lender. Many online auto loan web sites are fronts for car dealer lead-generation while other sites are individual lender sites. Read “about us” if you are not sure as they tell you how they operate.
- Auto loan lead generation websites:
On lead generation web sites, you apply for a loan and your application information is immediately routed to one or more car dealerships. You get dealer financing with these sites.
- Lender websites:
On lender websites, you can apply for a loan and may or may not get approved. Direct auto financing can get you a lower APR but it’s can very time consuming filling out multiple applications.
- Online Lending Marketplace:
Get up to four offers by bringing the best of the online banks, lenders, finance companies and credit unions together in one marketplace. These are real approved loan offers not simple quotes!
3. Be prepared for your trip to the dealership
Remember, to do your research before you arrive at the dealership. Dealers can make a profit on your financing by marking up interest rates and in some cases, inflating prices of service contracts and other insurance products. If you think the dealer can give you a better deal, then finance through the dealer. Otherwise use the online auto loan that you have been approved for. You’re done! No more delays or frustrations.
Caution: Don’t get “Switched or Flipped” when a dealer offers to beat your online deal by getting you lower payments while increasing term, sales price and/or increasing the rate (APR). Do not be a “Payment Buyer” focused only on the payment amount.
4. Negotiate like a cash buyer
With financing in hand, you are in a very strong position to get the best pricing on your new or used car. Work with reputable dealerships and your overall experience will be excellent. You are now prepared to be an empowered auto buyer! Good luck and happy shopping!
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