Getting the Best Interest Rate on Your Next Car Loan

Getting the Best Interest Rate on Your Next Car Loan

Getting the lowest or best interest rate on an auto loan is important. Sometimes, the only factor standing between you and your dream vehicle is the interest rate. Savvy auto buyers recognize the value of haggling. Employing clever buying tactics can get you a lower price on the vehicle. Unfortunately, haggling has little effect on interest rate. Yet, certain actions can improve a buyer's likelihood of getting a good auto loan rate. Consider the following tips on how to get the best interest rate on your car loan.

Comparison Shopping Using the Internet

If you want the best rate on an auto loan, you must be willing to shop for it. Auto dealerships commonly increase the interest rate on loans, which increases their revenue. With this said, car buyers who want the best rate should consider other finance sources For example, you could submit an application with an Internet auto loan broker. The broker will review your application, and find the best quotes. After comparing quotes, pick the lender with the lowest rate.

Improve Your Credit Score

Car buyers with the highest credit score and the lowest debt-to-income ratio receive the best rates. Thus, if getting a good interest rate is a primal concern, check your credit rating. Know all three FICO scores before applying. Does your credit report need improvement? Is the information accurate?

The contents of your report determine your auto loan rate. Getting a good rate may be as simple as paying off a few credit accounts, making regular monthly payments, or limiting your credit inquiries. Simple changes can improve your credit score by 30 - 50 points within a few months, and greatly improve your chances of obtaining a low rate auto loan.

Choose a Shorter Auto Loan Term

Several auto dealers advertise super low rate auto loans. To qualify, applicants must have good credit, and accept a shorter loan term. The average auto loan is 60 months, which equals affordable monthly payments. However, individuals who finance the vehicle for a shorter term, perhaps 24 or 36 months acquire better rates. If you can afford a higher payment, a shorter term is worth consideration.

For a list ofRecommended Auto Loan Lenders offering low interest rate loans, visitABC Loan Guide, an informational website about various types of loans.

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