All posts tagged auto financing

Auto Financing: 4 Plans to Help You Get into a Car Fast

by Carsurfer Admin on 2018/02/16 in Auto Financing with Comments Off on Auto Financing: 4 Plans to Help You Get into a Car Fast
auto financing

Before making the commitment to a car loan, take time to plan a few important steps. To get into a car quick and painlessly, it helps to maximize creditworthiness, budget accordingly, realistically consider your income, and obtain a preapproval.

Maximize Your Creditworthiness

To have the most auto financing options, check your credit beforehand. Knowing your score helps you know what to expect ahead of time. Also, it gives you the opportunity to improve your score. Always look for errors on your report. If account balances are inaccurately reported or if $0 balance on accounts are not reflected, you may find yourself paying more in interest or being denied. Pay particular attention to previous auto loan reporting. If possible, pay down credit cards or pay them off completely. Credit scores are sensitive to the percentage of your total available credit you have used. The lower the better.

Budget Accordingly

Before stepping onto a car lot, know what you can afford. Often, people make the mistake of just figuring the maximum they can squeeze out of their monthly income, but this leaves them at a disadvantage. It is important to only spend as much as you can comfortably afford, while still having enough room in your budget to meet other financial goals. Prior to purchasing a vehicle, make sure you have budgeted for other vehicle-related expenses, including insurance, gas, maintenance, and repairs. These amounts differ substantially with different vehicles, so the monthly payment should never be your only consideration.

Consider Your Income

A good rule of thumb is to spend no more than 10 percent of your after-tax income on a car payment. For example, if your take home pay is $2,500 per month, than a car payment of $250 or under keeps you in good financial shape. Some companies, like Bay Ridge Nissan, know that you also have to add insurance, gas, maintenance, and repairs to this figure. When you calculate the total costs, it usually becomes clear why the 10 percent rule makes sense.

Get Pre-Approved

This not only saves you time at the dealership, it saves you money as well. Pre-approval prevents you from having to make a quick financing decision. You can take the time to consider multiple options. They also give you negotiating leverage. From the dealership’s standpoint, you are not only a sure thing, but you can keep the negotiation focused on the price of the car instead of the monthly payment.

Armed with your preapproval and prepared with a budget, getting into a car fast is no problem. The balance of the negotiation is on your side when you know what you want to pay and stay within your parameters.

Auto Finance: Making The Most Of Your Trade-In

by Carsurfer Admin on 2016/12/19 in Auto Trades with Comments Off on Auto Finance: Making The Most Of Your Trade-In

If you have ever had the pleasure of buying a new car in the past, you may be well aware of the disappointment that is often linked to trading in a vehicle. Many car buyers feel that their trade-in is worth far more than they got for it, so this aspect of the car buying process is often filled with resentment. As you prepare to trade in your next car, you may consider following a few tips to maximize the amount of money you get for your trade in.

Get It Inspected

Through dealerships, like Young Automotive Group, you can easily get the car inspected before you take it to the dealership for a trade-in. If your car is given a clean bill of health, you can take the corresponding paperwork from your mechanic to the dealership to ensure you get top dollar for the trade in. If work is needed on the car, you can make the decision about which repair items to tackle before you trade it in to get the best value possible.

Research the Value

You can use your choice of online car valuation websites to research the actual value of your used car. These sites typically have a resale value and a trade-in value. Dealers offer a lower trade-in value so that they can mark up the cost to the resale value later to make their profit on it. With this in mind, you may get a better deal when you sell your car on your own. However, if you choose to go through a dealership for a trade in, use your online research to avoid being cheated out of money.

Keep the Numbers Separated

Some dealerships try to work the numbers of the trade in and the new car purchase together. For example, they may say they can give you so much on your trade in if you pay so much for the new car. Avoid getting caught up in this situation, and hold firm that you want to work out the trade in numbers before you talk about buying the new car.

Get Multiple Offers

Finally, avoid jumping at the first offer you get. It can take time to shop around with various dealerships, but this ultimately could save you hundreds or even thousands of dollars. Identify at least three dealerships to get quotes from before you make a final buying decision, and let all three know that you need their best offer because you will be shopping around.

While it can be disappointing to learn what the true value of your trade in, you can minimize your resentment when you follow these steps. These steps will help you to get the most out of your trade in for your financial benefit.

3 Ways Your Credit Score Affects Your Auto Financing Options

by Carsurfer Admin on 2016/11/09 in Uncategorized with Comments Off on 3 Ways Your Credit Score Affects Your Auto Financing Options

When looking to buy a new car, unless you can make one payment in full, chances are you will have to finance it. During the process of financing a car, you will look to arrange a payment plan for the car and pay it over a certain period of time. Consumers who are looking to finance a car will need to fill out an application so that they can get a car loan. One of the things that is critical to your auto financing is your credit rating. A person’s credit score will determine a few things that are very important in any car financing deal. The credit score will affect your auto financing options with the interest rate, monthly payment and the price that you can afford.

Interest Rate

The first way in which your credit score affects your car financing is the interest rate. If you have a high credit score, you will get a low interest rate. As a result, the car loan will be quite affordable for you. On the other hand, if your credit score is low, you will most likely end up getting a very high interest rate. With an interest rate that is high, you will have to pay more every month for your car. Look for dealerships like Markosian Auto arrange the best financing your credit qualifies for by teaming up with top lenders to offer the best interest rates possible.

Your Monthly Payment

Another way in which your credit score affects your car financing options is the monthly payment. Depending on the interest rate you get, the payment will either be lower or higher than average. The monthly payment is the principal along with interest. Those with a low credit rating will have more interest to pay each month and therefore have a higher overall payment. Anyone who has less interest to pay will have a lower amount of money to pay on their auto loan.

The Price You Can Afford

Along with the interest rate and the monthly payment, your credit rating affects your car financing in terms of how much you can afford on a car. The interest rate effects the monthly payment and the monthly payment is based on the loan amount. In other words, the amount you need to pay each month will determine the amount you can get for a car loan. Consumers who have a low credit rating will likely be limited to buying a very cheap inexpensive economy car. Those who have a high credit rating will be in position to afford a more expensive vehicle.

It is important to keep in mind that your credit score is detrimental to the terms of your auto loan. Your credit score will affect your auto financing options through the interest rate, the monthly payment and the price of a vehicle that you can afford. Therefore, it is important to make sure that your credit score is as high as possible to get the best auto finance deal.

5 Things to Remember When Applying for an Auto Loan

by Carsurfer Admin on 2015/11/11 in Auto Financing with Comments Off on 5 Things to Remember When Applying for an Auto Loan

Most people who are looking to purchase a new or used vehicle must first obtain an auto loan to afford the car. Auto loans are often available through financial institutions or through the dealer who is selling the vehicle. When applying for a loan, there are a few factors to keep in mind.

Know Your Credit Score

The lender will check your credit score when determining if you’ll be approved for a loan. Your credit score will prove if you’re qualified to borrow and if you have any record of collections on your history. Those who have a credit score of at least 650 are likely to be approved.

Have a Down Payment Ready

Having a down payment on hand will help to reduce the amount of money you borrow, which will ultimately allow you to spend less on interest once the car is paid off in full. The more money that you can put down, the less time it’ll take you to pay of the vehicle.

Determine the Length of the Loan

The length of each auto loan varies and can be up to 60 months long. 62 percent of auto loans are 60 months and 20 percent of loans are 73 to 84 months long. The longer you’re paying off the loan, the more money you’ll end up paying in interest.

Consider Your Employment History

If you’ve had an inconsistent employment history, you’re at risk for being denied of an auto loan. Lenders want to see that you’ll be able to make your car payment each month and eventually pay it in full.

Understand the Interest Rate

Each auto loan comes with interest that is applied, which is added on to each monthly payment. The interest often depends on the lender’s terms and the credit score the applicant. The higher the credit score, the lower the interest rate. Oftentimes, borrowers are able to negotiate the interest rate. A credit union car loan may offer some added benefits for interest rates if you are an existing member.

When applying for an auto loan, it’s important to understand the terms and how long you’ll be repaying the loan. You want to be confident that you’ll be able to afford the loan for the next several years even with a job loss. By proving yourself to the lender as a qualified borrower, you’ll be approved and can enjoy driving your new vehicle off the lot in no time.

How Can I Safely Afford the Car of My Dreams?

by Carsurfer Admin on 2015/02/06 in Auto Financing with Comments Off on How Can I Safely Afford the Car of My Dreams?

Finally owning the car that you have always wanted can be a thrilling experience. However, that thrill can turn to fear if the cost of the car is ultimately more than you can afford. This is why you should account for the total cost of ownership and plan ahead for how you will handle the car payment if you suffer a loss of income.

Negotiate the Right Price for the Car

This concept is one that may be foreign to many people that don’t live in a country where bartering is commonplace but negotiating a fair price for the car you want should be a high priority for you. It is generally a mistake to think of the monthly payment when negotiating a car deal. Instead, make sure that you are getting the best price for the car. Afterwards, you can negotiate the length of the loan and your interest rate to find a payment that you can afford.

Put Money Down if Possible

Putting money down ahead of time increases equity while lowering the amount that you have to pay each month. This can come in handy if you lose your job or otherwise find that you need to get rid of the car for some reason.

Don’t Be Afraid to Trade the Car if Necessary

In the event that you find your dream car isn’t everything that you thought it would be, do not hesitate to trade it in. It is much better to have financial security as opposed to a fancy car in the garage. Besides, having the car isn’t going to be much fun if you can barely afford to put gas in it.

Look at the Value of the Car Before Buying It

The best way to know if you can afford your car is to find out how much it is worth ahead of time. This gives you a good idea if you can buy the car and still have an asset that has value several years down the road. Knowing this fact is important because cars are depreciating assets that lose value over time.

Don’t Forget to Think About Insurance Costs

In addition to paying for the car, you will also have to pay to insure the car. Insurance costs could run over $100 a month if you are buying an especially fancy model. Therefore, ask your Thomson Schindle Green Insurance & Financial Services Ltd insurance agent how buying your dream vehicle could impact the cost of auto coverage. Often, people are unaware of the extra costs that can be incurred after buying a new vehicle.

Do you want your dream car to be in your garage for years to come? If so, you need to figure all the costs of ownership and possible depreciation beforehand to ensure that you can afford it without going into financial peril.

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