Getting an Auto Loan
// December 7th, 2009 // Loans
When it’s time to get a new car, your dealer will probably encourage you to get your financing through their preferred lender. Why? Lenders usually receive compensation for auto loans that they get. This is a revenue source for the dealer, but it usually doesn’t save you any money.
It’s a good idea to seek your own loan, rather than go through the lender that the dealer uses. That way, you are sure that you’re getting the best payment terms and interest rates possible. If you have tarnished credit, there are some things you need to keep in mind when looking for a lender.
Your lender should offer a reduced interest rate, but you will have to put more money down. They should also give full disclosure on finance charges- in fact, it’s the law that they do just that. This allows you to make an informed decision before you sign a contract. Check with your lender to see what your financing options are- you want a deal that will work for the long term. A loan with a low “teaser rate” may seem appealing, but when the rate gets raised without warning, it can be hard to manage.
Auto loans don’t have to be hard to get- there are many lenders offering their services online.
