Auto/Car Loans » Car Loan Guide

Car Loan Guide

The Internet has revolutionized the way we do and think about situations. Now, it easy and convenient to be knowledgeable about car loans in every aspect before even venturing into a car dealership. But, car loan tips and tips to finance a car come handy only when you have zeroed in on the type of car you want to buy. This makes it easier for you to choose your car loan. Advice and tips of car loans is available on websites of car dealerships of GM, Toyota and Lexus. Car loan tips are also available on government websites. These websites are specific to a country and help you if you plan to buy a car in a different country.

Tips of car loans/ tips to finance a car:

Always shop around online - do your research. Try to be proactive and read up on various car loan schemes and ways to finance a car. Compare different car loan features and see what is right for you.

Consider smaller lenders too - When shopping around for a car loan, consider community banks, credit unions and other smaller financial institutions which might be more approachable, and offer lower interest too.

Know your credit score - Always know your credit score before applying. Get rid of any bad blemishes to avoid having a poor credit report card. Close any open credit cards you don't need or use. Pay down or pay off your credit cards. Do not blindly apply for a loan and get declined or get a high interest rate because of factors you can control.

Be clear about leasing - Leasing is really just another form of borrowing to finance a car. But unlike loan finance where you take ownership of the car and offer it or something else as security to the lender; lease finance sees a leasing company take ownership and give you the use of the car under contract for a specified period.

Go in for alternative avenues of car financing - If the banks, building societies and credit unions won't lend to you because you're self employed, newly arrived in the country or have a poor credit history, consider the booming non-conforming and "low doc" loan market. A number of non-bank lenders offer loans which especially cater for this type of borrower. The interest rates on non-conforming loans are generally higher but come down after a few years of on-time repayments.

Never go in for unsecured personal car loans - always enter into car financing schemes which require collateral. Secured personal car loans can get you a lower interest rate.

Try to find out if you qualify for a relationship discount on your car loan - Relationship discounts are available from banks and credit unions for those borrowers who consolidate a range of banking business with the one institution. Home and personal loan interest rate discounts, term deposit bonuses, savings account fee waivers and credit card annual fee waivers are commonly offered.

Always be honest in car loan applications - Honesty in your car loan application will get you a suitable car loan customized to your convenience. In addition, do not make multiple car loan applications to various lenders.

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