1. Research the market
Knowing your options does two things. First, it ensures you get the best deal possible by knowing what’s out there at what rates. Second, it ensures you’re completely happy with the deal we provide when you come to us for a car loan.
An informed buyer is an effective buyer so there is no substitute for knowing your options. Once you know average rates and what options are open to you, it is very easy to appreciate just what a good deal you get when you secure your car loan through us.
2. Know your credit situation
Knowledge is power and your power comes from knowing exactly where you are. That means knowing your credit score, knowing your credit report is 100% accurate, that any mistakes have been rectified and any potential lender has a clear, positive picture of your situation.
Checking your score early gives you the chance to fix any inaccuracies and address any potential issues before you approach a lender.
3. Avoid minimal monthly payments
While it may seem counterintuitive, concentrating on minimizing your monthly payments could actually make your car loan more expensive. A lower monthly payment often means a longer loan term. As interest is accrued over time, the longer the term, the more interest you pay.
There may be situations where it is necessary to go for the lowest monthly payment. It isn’t always the best idea though.
4. Negotiate with strength
Even if you have poor credit, you’re the customer and both the lender and dealership wants your business. Even if you consider yourself the less-than-perfect customer, you’re still a customer.
Work with the dealership or lender, be amenable and flexible but don’t think for a second you’re in a weak position because you’re not.
5. Maximize your down payment
We have covered down payments in other posts so we won’t labour the point here. However, if you’re in a position to save or place a larger down payment on a car, you’ll get a better deal on a loan. That loan will also be smaller relative to the cost of the car, which in turn, should lower the interest rate.
The end result is a cheaper loan to pay monthly and over the term.
Do you have any tips for getting a great deal on a car loan? Tell us about it if you do!