Are you currently in the market for a new car? Welcome to one of the biggest decisions of your life!
There are so many things to consider when it comes to purchasing a vehicle. From make, model, colour and so on, to the details like km’s on the odometer, andfuel effiency, the list goes on. And on.
To be completely honest, yeah, it can be a little bit daunting if you’re not a seasoned car enthusiast or negotiator. One of the major things to be aware of is the high competition for your business when it comes not only to cars, but car loans.
Staying well informed could save you enormously in the long run. Here’s what you need to know about finding the best loan for your vehicle purchase.
Keep your budget top of mind
Kn owing what you can afford and sticking to it is probably one of the most crucial things to do when acquiring a vehicle loan, or any loan.
Before you start looking for a car, sit down and calculate your incoming and outgoing expenses as at today’s date, as well as how much you can afford to repay, and over how long.
Remember to factor in all of the costs associated with owning a car, including registration, gas, insurance, maintenance, repairs, and tolls. These things all add up over time!
Get rid of those debts
Finance providers will assess your eligibility before giving you the green light on finance. Before applying for a car loan, strive to pay off any existing debts and create a savings plan. This will demonstrate to lenders that you are a trustworthy and good customer.
Shop for the best vehicle finance deal
If you’ve read our article about car salespeople’s tactics to get you to spend more money, you’ll know that urgency is a key ingredient to any successful sale. The same applies to car finance. That’s why we recommend to not choose the most convenient option.
Do your research. See how your car dealer’s finance compares with independent lenders, then weigh up all of your options before making the decision.
Keep an eye on the interest rates. A low-interest rate may mean you have little to no room for negotiation on the actual car, so you need to be sure of what’s most important to you.
Don’t ruin your credit score over a new car!
While submitting repeated applications for a car loan may appear to be a smart idea, it can have a significant negative influence on your credit report, especially if you are turned down.
This one catches people out sometimes, so we thought we’d mention it here if you’ve heard of this approach.
Instead, we recommend just applying for one loan and sticking with it. Keep it simple.
Fees associated with your finance
There’s pretty much always a fee for the privilege of being the finance company’s customer. This might be in the form of an application fee, and even spikier monthly service fees. Get the information straight from the source, they legally have to give it to you if you ask the question.
Look for this in a loan’s terms and conditions, and if possible, choose a lender that doesn’t charge continuing costs.
Buying a car is an exciting but significant decision. If done incorrectly, so put time into doing things the right way. You don’t want to walk away with a sour taste left in your mouth for term of the loan agreement – that could be a while!
Consider what will work best for you and do your study thoroughly. You’ll be grateful to your future self!
Okay, feel like you’re in a pretty good spot? Before you look at finance, make sure you’ve got your sights set on the right vehicle. If you need a hand figuring out if the vehicle is worth financing, a pre-purchase inspection through MyAutoShop is your ticket to ride.