When you go to buy a new car, financing and the process you go through to get that loan can seem overwhelming. Where do you start? Do you get the loan before you look? How do you get the best APR? What if you’re turned down? What if your credit isn’t perfect?
There are so many questions you can ask yourself, that sometimes it seems easier just to go to the dealership and handle everything right there. This is one option. If you’re purchasing a car from a great, reputable dealership, you shouldn’t have any problems. But you should still be aware of what you’re signing, your APR, what your monthly payment will be, the length of the term and other details.
If you’re a first time car buyer, you can often get a pretty good financing package at a dealership. They’re very helpful during the process and it can often seem much simpler than first going to a bank to get a loan. The potential drawbacks are that often you can get much better loan terms from a bank or credit union, or other avenues of getting a new car loan. It is an option, however, and you may find your dealership is able to offer you the best terms after all.
Be sure to negotiate the price of the car you want before you talk about financing, to make sure the price isn’t hedged up to make up for a lower interest rate. And don’t let them talk you into the credit life insurance that will pay off the car if you die. This is an extra expense that will just prove to be a waste of money for you.
Of course, another option is borrowing from your bank or a lender. While you can certainly approach any bank and ask about their new car loans, the bank or banks you’ve already been doing business with for a while are more likely to give you the best rates. You’re also more likely to be approved for the financing from an institution you have a history with. You may not be able to negotiate the terms of financing like you can with a car dealership, but chances are the negotiation was more for your perception than any real savings anyway.
Your best option to find varieties of car loans with different rates to choose from is to search on internet. There are a lot of companies and car loan lender websites such as https://www.billan24.se/ who are competing to get you as as their new client, so you will have couple of different options to choose.
If your credit isn’t very good and it’s unlikely you can get a traditional loan through a bank or credit union, you can try a finance company. If you’re approved you’ll pay more for the loan, but it will probably still be less than what many dealerships would offer you. You may have to compromise on what you want though. They may be more likely to give you a loan for a less expensive used car, for instance.
Don’t forget other options you may have that can offer better deals. If you have a life insurance policy, you can borrow against it, for instance. And the higher down payment you can manage, the less you’ll need to borrow for a new car loan which also increases your chances of approval.