getting a car loan

getting a car loan

Getting A Car Loan

Where to shop for an auto loan Walking into a dealership with a guaranteed auto loan in your hand gives you bargaining power and flexibility. It also helps you avoid the common sales tactic of mixing up the vehicle price with financing costs. On the other hand, going into the dealership without doing research on how you are going to finance your purchase is setting yourself up to overpay. One place to start your search for a loan is at www.bankrate.com. The website shows you the current average loan rates nationally. And by entering your ZIP code, you can see some offers tailored specifically for your area. But the site often doesn’t include a lot of local lenders or, in some cases, national ones. So it’s worth checking with individual institutions, as well. A dealership may be able to offer you the best financing terms. But you should still do your homework beforehand by carefully shopping for the best loan offers so you have a comparison point. Also, taking the automaker’s low- or zero-percent financing often means having to pass on a rebate, since your choice generally is one or the other, not both. But you often can get the best of both worlds by taking the rebate from the dealer and getting financing elsewhere, even if the interest rate is higher than the promotional one from the manufacturer. To use the loan-versus-rebate tool, you’ll first need to shop for the best alternative rate. Here are some places to look: Local banks. Banks generally have very specific, conservative loan policies and may only cater to those with better credit references. As such, banks are in a position to offer some very com­petitive loan rates. Since you probably have a relationship with at least one bank already, that might be a great place to start your financing search. Most banks have websites where you can check their current loan rates, but if you decide to apply for a loan, you should stop by a branch office and deal with a real person. It’s a good way to control where your personal information goes, and by avoiding mistakes or misunderstandings, you might walk out the door with a pretty good interest-rate offer. Local credit unions. Credit unions operate a bit like banks, but they lend money only to their members, who are also owners of the credit union itself. Because credit unions are nonprofit, their operating costs are fairly low and their lending rates can be quite competitive. Many people belong to credit unions just to take advantage of the convenient loan policies. Online banks. Online lenders can be competitive. Instead of visiting a local office, you apply over the Internet. To find them, do a Web search for “online auto loans.” Online financing has a down­side, however. It may be difficult to control where the information you provide about yourself goes, and you may be bombarded with e-mail and phone calls from lenders you never heard of or contacted in the first place. Be sure to check each website’s privacy policy before providing personal information. As a precau­tion, if you’re not familiar with the lender, check out its site with the Better Business Bureau. Dealerships. Along with arranging loans from automakers, dealers work with banks and other independent sources. One benefit to arranging financing through a dealer is convenience. But often the rates they quote include a markup for the dealership itself, which can make these loans expensive. Armed with offers from some of the other sources we’ve mentioned, you may be able to negotiate the dealer’s initial quote down to something attractive. But you must do your homework first. Also, some dealers advertise that they will work with buyers who are credit risks, but you should count on paying a high APR.
getting a car loan 1

Getting A Car Loan

Walking into a dealership with a guaranteed auto loan in your hand gives you bargaining power and flexibility. It also helps you avoid the common sales tactic of mixing up the vehicle price with financing costs. On the other hand, going into the dealership without doing research on how you are going to finance your purchase is setting yourself up to overpay. One place to start your search for a loan is at www.bankrate.com. The website shows you the current average loan rates nationally. And by entering your ZIP code, you can see some offers tailored specifically for your area. But the site often doesn’t include a lot of local lenders or, in some cases, national ones. So it’s worth checking with individual institutions, as well. A dealership may be able to offer you the best financing terms. But you should still do your homework beforehand by carefully shopping for the best loan offers so you have a comparison point. Also, taking the automaker’s low- or zero-percent financing often means having to pass on a rebate, since your choice generally is one or the other, not both. But you often can get the best of both worlds by taking the rebate from the dealer and getting financing elsewhere, even if the interest rate is higher than the promotional one from the manufacturer. To use the loan-versus-rebate tool, you’ll first need to shop for the best alternative rate. Here are some places to look: Local banks. Banks generally have very specific, conservative loan policies and may only cater to those with better credit references. As such, banks are in a position to offer some very com­petitive loan rates. Since you probably have a relationship with at least one bank already, that might be a great place to start your financing search. Most banks have websites where you can check their current loan rates, but if you decide to apply for a loan, you should stop by a branch office and deal with a real person. It’s a good way to control where your personal information goes, and by avoiding mistakes or misunderstandings, you might walk out the door with a pretty good interest-rate offer. Local credit unions. Credit unions operate a bit like banks, but they lend money only to their members, who are also owners of the credit union itself. Because credit unions are nonprofit, their operating costs are fairly low and their lending rates can be quite competitive. Many people belong to credit unions just to take advantage of the convenient loan policies. Online banks. Online lenders can be competitive. Instead of visiting a local office, you apply over the Internet. To find them, do a Web search for “online auto loans.” Online financing has a down­side, however. It may be difficult to control where the information you provide about yourself goes, and you may be bombarded with e-mail and phone calls from lenders you never heard of or contacted in the first place. Be sure to check each website’s privacy policy before providing personal information. As a precau­tion, if you’re not familiar with the lender, check out its site with the Better Business Bureau. Dealerships. Along with arranging loans from automakers, dealers work with banks and other independent sources. One benefit to arranging financing through a dealer is convenience. But often the rates they quote include a markup for the dealership itself, which can make these loans expensive. Armed with offers from some of the other sources we’ve mentioned, you may be able to negotiate the dealer’s initial quote down to something attractive. But you must do your homework first. Also, some dealers advertise that they will work with buyers who are credit risks, but you should count on paying a high APR.
getting a car loan 2

Getting A Car Loan

Many people think that when you finance a car, the finance company lends you the money and the car is yours. In reality, however, the lender is buying the car and letting you use it. The lender actually owns the car, and they’re nice enough to let you drive it while you’re paying off the loan. In fact, you won’t have the title to the car and own it outright until you make your last loan payment. If you don’t make your car loan payments, the lender can repossess the car. If the car is destroyed or stolen during the term of the loan, you are still responsible for paying the loan back, which is why lenders require you to carry insurance on the car that names them as the lienholder.
getting a car loan 3

Getting A Car Loan

One more thing. My friends told me buyers can cancel entire car contract within 48 hours. I asked the bank. They were not sure I don’t want to cancel my contract.I just want to cancel my loan contract which they offered 5.8%. Now banker told me that they could give me 3.5% flat. They just wonder if the loan manager asked me to pay early cancelation fee. Because I just bought a car Saturday afternoon(which is yesterday). Then, I would like to cancell current loan on Monday aftter 3:30. Do I need a cancelation fee? or I don’t need. Bank told me that if a dealer asked for cancelation loan fee, just paid. They will cover. But my friend told me that just leave the current loan which is 5.9% and pay entire using my new loan when it’s time to pay my first month car loan payment.

Getting A Car Loan

Getting A Car Loan
Getting A Car Loan
Getting A Car Loan

Published on Jun 19, 2017 | Under Car | By michael ellis
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