Posts tagged ‘car buyers’

Car Finance – Three Great Financing Options

When in the market for a new car purchase, there are more ways than one to finance this new car! Most of us can’t pay cash for the entire vehicle up-front. More than 80% of car buyers use some sort of financing options. With this method more people are able to get the new vehicle they need at a more manageable way of paying for it. The purchase price is broken down into manageable monthly payments. You have several financing options, each has its own pros and cons you must carefully consider before deciding on which is better for you.

0% Financing

Newly made popular by the automotive meltdown is 0% financing. This allows buyers to extend the life of the car loan without the normal interest rate that comes with a loan. Dealerships have this to be a great way to draw in customers. However, in order to qualify for this type of financing you have to have a nearly perfect score. Plus, you have less time to pay back the loan. Rather than having lower monthly payments and repaying the loan over a 5 year period, you might have high payments spread out over a 3 year period.

Cash Back

You might want to opt for a cash back incentive, instead. This option offers two choices. One offers a 0% APR and the other a cash back. Deciding which option is for you, you first need to figure out what dollar amount the interest amounts to over time. For example: a $10 000 loan at 5% will cost you about $500 in interest. If the cash back incentive is more than $500, take the cash back. If it is less, take the 0% financing.

No Money Down

Another option is the now famous

How Car Financing Works

If you have ever bought a new car before you probably have a pretty good idea how financing works. Or do you?

Think Before You Sign

Most car buyers never think twice about the financing options they are offered at the dealership. They take whatever is offered, sign away their rights and agree to a series of things they don’t need but think they do because the salesman or financing agent at the dealership, told them they do.

When it comes time to finance your next car do yourself a favor and shop around for the best deal.

Consumers don’t think anything of driving two miles further down the road to save fifty cents on a gallon of milk, but they won’t budge from their seat at the dealership to get a better deal on financing.

Little Extras Add up Quickly

Dealerships make the majority of their money from the little extras they tack on at the end of the deal, after you agree on a price for the vehicle. The undercoating, security system, stereo and navigation system they offer to add on.

Dealers also make a bigger profit off you than they would care to admit. They get rebates from the manufacturers which they could offer you, sure, but they also get discounts for selling certain vehicles which they usually don’t offer buyers.

No one sells cars for free, it wouldn’t make any sense at all. Paying cash for a new car is not an option for most of us. If you can save more on interest than you would earn if you put that money in a savings account than it is definitely a good idea to pay cash for it. If not, or if you just don’t have the cash on hand to pay for your car in full you are just like most people. That doesn’t mean you let yourself get ripped off, however.

Everybody Wants to Make Money

Financing comes down to money. The lender wants to make money, and they will from the interest they earn off you in the form of monthly payments. The term you set for your loan also has a lot to do with how much money they will make. Sure, you can lower your payments by extending the life of your loan, but in the long run you will pay more in interest so you really are not saving yourself any money at all.

Put More Money Down

You can also lower your payments by putting more money down on your vehicle. This is always your best option because it shows the lender you have a vested interest in paying off the loan and that in turn should result in a better interest rate and lower monthly payments.

Do Your Homework

When it comes time to finance your next new vehicle do yourself a favor and do your homework. Compare vehicle prices, compare financing options and don’t sign anything or buy anything you are not absolutely sure you need.

Best options for voluntary auto reposition

Most car buyers utilize their credits to buy a brand new or a used car. They secure car loans to finance the vehicle purchase and in return they provide monthly payments. The monthly payments are paid until the last day of the loan term or until the borrowed amount is paid off. Failure to provide the monthly payments might result to repossession of the vehicle. However, there are cases where the buyer returns the car to the dealership or the lender commonly called as voluntary auto repossession upon knowing that they can no longer pay for the financing.

Hand over the vehicle

In the event that your financial condition has suddenly change and you know that paying for the payment of the loan would be impossible, you can voluntarily hand over the car back to the dealership or the lender. Although this would not erase the debt that you have with lenders, this will save them from repossession costs that would be eventually charged to you. As soon as you return the car, the creditor would automatically have the option whether to hold the car as a form of compensation or sell it to other buyers. However, the lender is obliged to inform you of what they are planning to do with the car and the law provides you with all the right for a fair sale.

Important warnings

Always bear in mind that voluntary repossession reduces the amount you owe from lenders but this doesn

Car negotiation: 4 Ways on avoiding Tricks and Scams

It is important for you to know the proper procedures in conducting car negotiation. This is because most car dealerships and salesmen are fond of applying tricks on unsuspecting car buyers just to earn profits. Most salesmen who are working for car dealerships are paid on a commission basis which means that the more cars they sell and the more add-ons they place on a single deal would increase their commission. Due to this, you need to arm yourself with proper negotiating skills and sufficient knowledge about the vehicle you intend to buy before stepping on the dealership