Posts tagged ‘car payment calculator’

Why You Should Shop for a Loan

When it comes time to buy your next new vehicle do yourself a favor and start shopping for a great loan first.

The financing part of buying a car is usually the most important part. Sure, you need a certain type of car and you will be stuck with it for years to come, but the money you could lose by choosing a financing option that doesn’t offer you good terms is worth more than a good looking car.

Know Your Credit Score

Start by getting your credit report and giving it a good review. Check for errors, they are not uncommon, and fix anything on there you can fix. Your credit report impacts your credit rating which in turn impacts the rate of the loan you will need to buy your new car.

How Much Can You Afford

Next, decide how much car you can afford. Look at your monthly bills and determine how much more you could afford to pay every month for a car payment. You also need to know what the likely interest rate is that you will pay. Look around and see what is being offered, because it is likely what you will pay too. Then go online to a car payment calculator (there are many) and use this information to determine how much car you can afford.

Put Down as Much as You Can

Remember, the more money you put down on your new car the lower you can make your payments. Also, the longer you need to pay it off can also have an impact on your monthly payment. It also means you will pay more in interest, so be careful.

Ask Your Bank First

Once you have this information in hand you can start shopping around at lending institutions. Start at your local bank. They have known you for years and are more willing to deal with people they have an on going relationship with. Ask about financing your new car through them and see what terms they can offer you. Then take this same information to the local credit union and comparison shop. Don’t be embarrassed to show them the deal you were offered at your bank and ask them to beat it. Credit unions were mostly unaffected by global recessions and are looking to expand their businesses right now so they might be more willing to deal with you and make a great offer.

Go Online

With those bids in hand head online and start shopping internet financing agencies. Unlike a traditional bank an online financing agent does not have a brick and mortar office they need to pay for so they will likely offer you a better rate than either a bank or credit union. You won’t know if you don’t ask so do your homework and check around before committing to anything.

Now You Can Face the Dealer

With all this information in hand you are ready to face the dealership. Once you pick the car you like, knowing full well what type of financing you can get for yourself, you can ask them what they can do for you. If it doesn’t measure up to the offers you have received, no need to worry. You did your homework like a savvy consumer and can take care of the financing yourself.