Auto Loans: Finance A New Car - 3 Steps to the Cheapest Auto Loan
When you need a new car, it is easy to block everything else out of your mind
. It's all you can do not to daydream about your imagined new set of wheels: that shiny paint job, the latest gadgets, and that fabled new car smell.Of course, one thing that you cannot afford to block out of your mind completely is just how you are going to pay for that new automobile.
Auto Loans Are Necessary for 99% of Us to Get a Car
If you are like 99% of the rest of us, you are planning on financing the purchase. Auto loans are the preferred method for paying for a car, plain and simple. Unless you plan on buying a very old (more than 10 year old) used car - or unless your net worth easily climbs into the 7 or 8 figures - you are very unlikely to be able to pay cash for a new car.
No worry: getting an auto loan is not difficult, and there are plenty of financing companies who are ready to do business with you. But with so many choices for financing your car, the trick is making sure you get the best-possible interest rate and loan terms.
Financing a Car Requires Not Just Good Credit
The single most important factor that banks and other auto lenders look at when putting together your auto loan offer is your credit score. At the end of the day, it is the credit score that largely determines the kind of deal you qualify for.
However, there are other important factors lenders consider, as well, including: your overall employment history, length of employment with your current employer, whether you own or rent a home, and even how well you present yourself in person.
3 Steps to Auto Loans: Finance Your New Car the Right Way
Obviously, you are going to want to slant things in your favor when applying for a loan. If you are looking for auto loans to finance a new car, here are 3 steps you can take to get the best loan:
1. Look into your FICO score: Before applying, make sure you check your FICO (credit) score with at least 2-3 of the major credit bureaus. Make sure you correct any errors you discover on your reports by writing to the credit bureau directly. Then, write down your scores and be prepared to give them to the lender.
2. Gather your employment history and other important information in one place: Put together all of your important documentation. Make sure you have contact information for past employers, as necessary.
3. Create a list of at least 3-5 lenders: Now comes the important part: make a list of at least 3-5 auto lenders. Do your online research. Look for those that have the best rates and are the most reputable. Make sure to apply to at least 3 lenders.
Follow these 3 steps to get the best deal on your auto loan.
Auto Loans: Finance A New Car - 3 Steps to the Cheapest Auto Loan
By: Marie-Claire Smith