It's a great thrill to be handed the keys to a new car and to take it out for its first spin. Owning a new car is a dream for some and a necessity for many, but the main drawback for almost everyone is the cost. Unless you've had a lottery win or a windfall, the chances are you will be looking for a loan to finance the purchase. Fortunately, there are plenty of low interest rate auto loans available, and the key to finding the right one is to shop around.
To ensure you get the lowest interest rate available, the first thing you need to do is to examine your credit rating. Free credit reports are an entitlement and well worth using. They may reveal relatively minor errors or problems, such as a small unpaid bill at a former address that can be rectified easily to improve your credit score. Fix any problems that are highlighted in your report before applying for low interest rate auto loans to make sure you are offered the lowest possible loan rates.
There are free downloadable tools and auto loan calculators to help you to put your finances in order and work out a sensible budget. Knowing how much you have to spend and sticking to your limit, will give you confidence and peace of mind when negotiating your loan. Being able to calculate the monthly payments over the term of your loan will put you in charge of your finances and give you a clear picture of where you will stand in the future. If you are looking for low interest rate auto loans on a new car, you may be looking at repayments over as much as six years, so long term planning financially is important.
As you shop around for the best possible low interest rate auto loans, you may find the better deals require insurance. If you already hold life insurance policies then it is worth going through the finer details to see how you would stand if you were unable to keep up repayments on your auto loan. Not all lenders will require insurance, but this may help you negotiate a better rate, so it is worth being armed with the facts.
Shopping around for the most attractive deals is vital. These generally do not come from the actual car dealership.
Some of the best low interest rate auto loans for used cars come through credit unions. These are small, non-profit financial organizations set up by groups of like-minded people to provide financial services to each other. Because costs are lower, loans can be of a shorter duration – which makes good sense for used cars. You can check out the Credit Union National Association to find and join a credit union near you and enquire about low interest rate auto loans.
There are also numerous online auto loan agencies offering attractive deals and low interest rate auto loans. Before approaching a dealership it is well worth doing an online check, which entails filling out a simple form, to find the best low rate loans. Being knowledgeable about what is available to you can only improve your negotiating powers when you are looking at that shiny new car.