Getting the Best Car Loan Possible
Getting the Best Car Loan Possible
In today’s competitive loan environment, it’s tough to know where to get the best loan. Banking institutions, car showrooms, and even online sites offer a plethora of car loan options. Wherever you decide to apply for your car loan, make sure you do all you can to procure the best car loan possible. Here are some tips that you can follow even before you walk into that showroom floor or nearest neighborhood bank.
Find out your credit rating
Before you sign that all-important loan document, make sure you find out your current credit rating. That knowledge can help you make that loan decision that much easier. If you know that you have excellent credit, then you can demand the best rates in town. Order a copy of your credit report from the three big credit bureaus – Equifax, TransUnion, and Experian. You can order these credit reports for free each and every year. Pay attention to the final credit score, as that’s what lending institutions focus on. For example, a FICO score of 720 or more means that you have excellent credit, while a score of less than 600 or so could spell trouble (higher loan rates).
Clean up your act
Once you know your score, you can now work on cleaning up your credit. If you have any late payments or delinquencies, then try to make payment arrangements and request those businesses to remove any late or delinquent notices. It can make the difference between securing a high or low interest loan. In addition, if you notice any suspicious credit card activity, have it investigated and removed if necessary.
Shop around
With so many banks and car dealerships out there, it’s wise to shop around. Try to get at least three different quotes to find the best rates possible. Just realize that rates not only depend upon the particular lending institution’s publicized rates, but also on your credit history.
Get pre-approved
Consider how much power you can have if you walk into the dealership with a pre-approved loan in your hand. With a pre-approved loan, you can then negotiate for a better loan rate with the dealership. Not only that, but the car dealership might reduce the price of the car since you’re a serious customer.
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