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There are many ways to bargain for the best fair profit offer on car financing, more commonly known as car loans. However, most buyers generally make two of the biggest new car financing blunders possible when searching for car loans. The first is trying to purchase a new car without checking online car loan rates. The second is then proceeding to get a car loan without validating whether or not their credit history can support it. The most ordinary automobile financing mistakes are by people who get their car loan at the dealer. Keeping a few pointers in mind can help prevent making such mistakes.
Rule No. 1: Don’t trade in a new vehicle on which money is still owed.
Without scepticism, refinancing is good way of saving money. What the dealer often offers is that instead of paying for a new car loan and taking cash out of your savings, you sell out the remaining payments of your previous car loan and let the new dealer pay for it. Apparently, this sounds too good to be true.
What happens then is that often, those individuals, after trading in a car, they still owed money and getting a new car loan, will discover two months later that the new car dealer has not yet paid off the old car’s loan in ten days as promised. Thus when the bank calls, they are still liable for making the payment because the old car loan is still in their name. Unscrupulous dealers do this habitually to save themselves money, causing the customer to end up paying more for the trade.
If this sort of agreement is really what a buyer wants to do, make certain the dealer puts in writing that they’ll pay off the car loan and by what deadline. This way, the buyer is better protected against getting cheated by a dishonest salesman.
Loan Rates and Credit Scores
As everyone knows, credit scores greatly influence any loan rates, including car loan rates. Those who have bad credit usually pay higher auto loan interest rates. Thus, in order to get the best end of the good deal, it will be important to get a credit report with credit score. This can be done online through several Web sites, such as Experian, Equifax, or TrueCredit. If a score is less than 550, it’s likely that the new car loan will have higher rates unless a bad credit auto loan is secured. Always paying on time and closing out inactive open accounts can recover credit over time, resulting in improved loan rates.
Tagged with: auto loan • car loan
Filed under: Car Loans