Whether you’re looking at a new auto loan or are trying to switch and make your existing one more affordable, there are a few ways to get lower car payments without compromising your credit score or your ability to drive a new car.
We asked our auto loans team to come up with some actionable ways to get lower car payments. These are some steps they suggest.
Lowering Your Auto Loan Payments
There isn’t much you can do when you’re in a loan to make that particular arrangement more affordable. But there are ways to ensure your next one is cheaper.
Here are a few ways to achieve that.
Save For a Larger Down Payment
A larger down payment does a couple of things. One, the more you put down, the less you have to borrow, which lowers your payments. Two, the more you put down, the more likely a lender is to approve the loan.
If you have the luxury of time before applying for the loan, we recommend saving as much as you can afford and put it all towards the down payment. Every dollar you add here could save two from the loan and interest.
Improve Your Credit Score
Sounds so easy, doesn’t it? Just improve your credit score to get a lower rate, which will help get lower car payments. It can be easy but it does take time.
Use one of the many methods we outline throughout our blog posts to improve your credit score and attract the lowest interest rates.
It won’t always save much, but every little helps!
Buy a Used Car Instead of a New One
There isn’t a huge amount of difference between a brand new car and one that’s 2 year’s old, except the price. Unless you’re going cutting edge like an EV or hybrid, consider buying a quality used car instead.
You still get to drive a new car, still get lots of technology and safety features but will pay a whole lot less for it.
Consider a Co-signer
If you have a less than perfect credit score, you could use a co-signer to help lower the interest rate and therefore, the monthly cost of the loan. As long as you know someone willing to guarantee the loan and they have a good score, you could save money every month.
Co-signers help boost your own application and can help attract lower rates so are definitely worth considering.
Work With Auto Loan Experts
Working with auto loan experts like us here at Dixie, is another sure way to save money on a loan. We work with lots of lenders willing to offer competitive rates to qualified borrowers.
We can also help you frame your application in the best way so it attracts the best rates. It’s all part of the service!
For those of you who know that you have a challenging credit situation, please visit Dixie Auto Loans where we have a team of credit specialists ready to help you get approved for a car loan today!