You’re in the market for a new car, and you know you’re going to need to financing. What steps can you take to be sure you’re getting the best deal? We have a few tips and tricks to help you get started.
Know Your Credit Score
Your credit score is a huge factor in determining your Annual Percentage Rate (APR), which influences how much you will end up paying by the end of the loan. Knowing your credit score will give you an idea of where you stand when it comes to financing. There are many websites where you can find your credit score for free, such as Credit.com.
Look Over Your Credit Report
Your credit score is a number that represents how creditworthy you are, and is determined by analyzing your credit history. A credit report is the actual documentation of your credit history, and includes personal information such as name and address, as well as information on your current and previous accounts. It’s important to be familiar with your credit report since it’s entirely possible that there may be an error in your information. If you find such an error, you can file a dispute with the credit bureau from which you obtained the report and get your information straightened out. You don’t want to miss out on a great rate because of a processing or reporting error.
Aim for a Shorter Term
When applying for car loans, you’ll find that the term length can really affect how much you end up paying by the loan’s end. A longer term usually means a lower monthly payment, but that means you’re paying interest for longer. Instead, figure out the shortest affordable loan term, and know that even if the monthly payment is higher, you’re saving money in the long run.
Financing a car can be a complicated process. Being prepared can help you find that great deal on a car you love.