Valuable Car Financing Tips This article gives some basic car financing tips that individuals or enterprises should be aware of before making the decision to purchase a car:
Review Credit Reports
- They assist you to know where you stand financially and help you spend wisely when buying a car
- Your credit score can be gotten from credit card issuers.
- The score gotten from the credit card issuers may not be the same one used by the lender but assist you to know your stand financially. Shop around
- Do research on the type of loan you want.
- You have to make sure that the loan taken is of low-interest rate, so that you cannot be left in debt.
- When shopping around one should compare the best interest rate with the annual percentage rate, which includes the chargers you have to pay as well as the interest.
- Credit unions and banks can be a place to begin with in your research since they offer acceptable car loans rates and then compare that with the other rates from different lenders.
Choose a Loan
- There are many types of loans you can choose from depending on your financing.
- You must choose a loan that you can afford.
- Some of the loans you can choose from are Personal loans
- A form of direct lending.
- This is one of the cheapest methods of financing a car deal
- It can be gotten from a bank which you have an account in and you have good ratings.
- A form of dealership financing, which is arranged by the car dealer.
- On buying the car, you put down a 10% deposit of the total amount and the rest is paid in installments.
- The installments are spread through a period of 12-60 months. Personal leasing
- This is where you pay the dealer a monthly fixed amount for the use of the car, with financing and maintenance included for a specific mileage.
- At the end of the agreement, you return the car since you do not own it
Personal Contract Plan
- This type of plan involves you paying the dealer, the difference between the car’s sale price and its resale price, based on the mileage in the agreement.
- Payments are spread for a period between 12 to 36 months.
- Monthly payments, not always the best option
- Do not always assume that you can afford monthly payments even if you have a good car deal. Try to haggle for lowest car price and highest amount of your trade-in without adding pressure on interest rate negotiation.
Beware of Finance Scam
- Mostly happens while dealing with dealers.
- To protect yourself from financing scam, you can let the dealer be aware that you will not purchase the car until deeming of the financing is complete.
- This prevents more costs of taking up more loans with higher interest rates.
You can be able to drive any car as long as your license is valid, you take the DSA theory test to make your license valid.