Are you looking to finance a new car? If you are, you're likely concerned about how much you're going to have to put down, as well as finding out how much your monthly payments are going to be. If you are living on a tight budget then there are definitely things that you can do before buying your new car that may just help you receive a loan with little to no down payment requirements, as well as a loan that is affordable for you to pay off. So, when shopping for your next car, be sure that you consider:
Trading in Your Car:
Chances are, you currently have a car that you are likely going to sell after you buy your new car. Well, rather than worry about selling it online or in your local classified ads, you may want to consider trading it in. Many dealerships offer trade-in options, which allows you to apply the value of your current car as your down payment. So, if your car is worth a good value price then this will be like applying a large down payment towards your loan, which can reduce the total loan amount that you need and this can easily lower your monthly payments.
Apply At Your Current Bank:
Rather than apply for loans from your car dealership, you will find it easier and often times better to apply from your current bank. If you already have a checking or savings account and have years of service with your bank then you are likely going to receive a loan with good terms and conditions, as well as a low-interest loan. This is because you have a good rapport with your bank and they will likely try to snag more of your business by providing you with an attractive auto loan. So, before you shop for loans from your dealership, definitely be sure to see what your current bank can do for you.
Avoid Reaching Credit Limits:
If you have any credit cards that are sitting at a high utilization rate then this could likely impact the quality of your loan. This is because your new lender will see that you rely heavily on your credit cards, which may give them the impression that you are not in a good financial situation. So, if your credit cards are at a high utilization percentage then you will want to be certain that you pay off some of your credit debt prior to applying for your car loan. This will help you receive a lower down payment requirement and receive a lower interest rate.
With these tips, you will be able to help yourself by potentially receiving a lower interest rate and by avoiding high down payment requirements. So, before you continue shopping for your next, new car, be sure that you take you take advantage of the time that you have to first shop for a great auto loan.Share
22 September 2015
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