auto loan rates

October 29, 2010

Auto Finance Rates and How to Get the Best

Chimezirim Chinecherem Odimba asked:

Normally when you are looking for a new car, two of the most important factors to consider are the price of the vehicle and the terms that you will be locked into. In other words, you want to make sure that your finance rates are within reason. When you buy from a dealership and finance through them, they will usually link you to a lender that is the maker of that brand of car (i.e. Ford Motor Co., Chrysler Credit, etc.).

You always have other options besides taking a loan this way for a car. The better that your credit is the more options that will be open to you and the better finance rates you will be offered. You can go to your bank or credit union and inquire about them financing your car too. This is actually the best route to take if you want to get the lowest finance rates.

If you secure your finance rates away from the dealership you will eliminate a lot of negotiations, you will be better able to stick to the amount that you initially had in mind to spend on a car, and sometimes it is made even easier by shopping for online bank lenders.

Currently, the national interest rate for financing a new car for 3 years is 6.89%, for a 48 month loan it is 7.12%, and for a 60 month loan it is 7.32%. For a used car it is slightly higher, 36 months of finance for 7.50%. You are not going to just stumble on a good finance rate for your car, you are going to have to have the skill required to seek one out.

There are a few things that can assist you in getting the best finance rate such as having good credit. If your credit is less than perfect you might want to consider working on fixing it up a bit before heading out for that new car loan. Another thing that helps is if you buy at the end of the month. Usually by that time the salesmen are frantic and also eager to close sales. Also, never give the lender a price that you are willing to work with and never take the first offer.

These are some of the things that you can do to keep those finance charges down as much as possible. Keep in mind that finance charges make a big difference in the amount that you pay for a car.


October 23, 2010

Private Auto Loans For Non Dealership Purchases

Sarah Dinkins asked:

Buying a used car directly from an owner will get you a much better deal than you would get from a car dealership. This is especially true in cases where the car owner and the car history are well known to the buyer. It eliminates the possibility of hidden surprises. On the whole, private auto loans have a lot in common with other methods of car financing. However there are also certain differences that can be important when deciding to purchase a car.

Higher Rates For Used Cars

When it comes to used cars, the rates for person-to-person or private auto loans invariably prove to be higher than those for a new car. To take an example, rates for private party sale auto loans from online auto loan lenders will usually be about two points higher compared to what is charged for traditional new auto loans and about one and a half points higher than the interest rate being charged for used car loans for vehicles purchased from dealerships. Moreover, the rates will fluctuate according to your credit history and other aspects concerning your loan application while new car loans from dealerships usually have fixed rates providing you qualify for them.

Repayment Schedules

Loan term may be less than that of a new car. The standard duration for financing a new car can be up to seventy-two months. In the case of private auto loans, it may not be possible to finance a vehicle for the same time period. Usually lenders are ready to finance private auto loans for up to forty-eight months, though there may be exceptions. However, auto loan financing should be done for as short a period of time as you can possibly afford. This is to ensure that you don’t end up in a situation where you owe more on the car than its value (upside down car loan) and to minimize the amount of interests you are required to pay.

Down Payments and Fees

With many lenders a down payment may not be required for person-to-person auto loans. Despite not being required, it is better to put money down. Doing this will reduce your chances of overpaying for your car loan in the future. Taxes, title and registration have to be paid separately when you purchase a new car from a dealership. The dealer normally combines taxes, title and registration fees into the loan amount. For private auto loans, the lender will not allow you to finance the fees and will require you to pay for them out of your pocket.

Title Transferring

On purchasing a new vehicle, the title is put in your name almost immediately. When it comes to person-to-person or private auto loans, it could take longer. The owner of the car you are buying from may still owe money on the car and it could take a week or longer for completing the payoff process. His lender needs to receive the payoff amount before he transfers the title to the car owner and then it can be turned over to you. The duration of this process is mainly based on the location of the lender. For a local bank, this process should not take more than a few days. However if the lender happens to be in another state, it could take much longer for the transfer to be done.

To briefly sum it up, private auto loans make a good option if you are a creditworthy borrower. However if your credit happens to be less than perfect, it may be better to turn to your local dealership as the best source for an auto loan.


October 21, 2010

What is the best site to get a bad credit auto loan?

crysta asked:

My credit rating sure is about 500, right now. Though I am usually very responsible with money, I was sick and unable to work for 3 years. I missed several payments and developed bad credit. Things have changed, and I am completely healed/not sick anymore.
I found a car that I like, which inexpensive so that I can pay it off asap. It also has low mileage. I see many websites online offering auto loans, but have no idea if they are legitimate. I guess they might have similar thoughts about me because of my credit history. lol! Where is the best place to go for a low credit loan? Thank you!


October 14, 2010

October 9, 2010

Question about my finances. Using overage check to pay off auto loan a good idea?

Sicks asked:

I have just started college. I am really enjoying it. Especially after being out of high school for 4 years. Anyhow, I am back into it and I have qualified for financial aid. It is an unsubsidized loan, with a total of a little over 6k. It is my first loan, and I intend to pay every bit of it.

My employer reimburses up to $5,200 a year, which is more than enough to pay for a year’s tuition at my college branch. If my calculations are correct, I should receive an overage check of about 4k, which is the same amount I have left on my auto loan.

I am being nailed on interest for the auto loan, which is 14.2 percent — I had no credit, no co-signer — so I had to bite the bullet of an extraordinary rate. So, I figure I will take the full amount of my award this once and pay off my auto loan. It will give me peace of mind because if I lose my job, I lose my car. But if I pay off the car, I can lose my job, but still keep going to school, for I do not have to pay back my loans until after I graduate. That way I can pay about $100 a month toward the overage check, paying it off well before I graduate.

So, for the people that have had much experience with their finances, been through many hardships, tell me, is this a good idea? Am I thinking on the right track for a young age — 23?


October 8, 2010

Is it cheaper to buy car from a private party or from a dealer?

Filed under: Buying & Selling — Tags: , , , , , — admin @ 11:53 pm
Lakerfan asked:

Here is the scenario: If I buy from the dealer, the interest rate on auto loan is 5.5%. If from a private party, I would need to apply for a personal loan with interest rate 10%.


I want to refinance my auto loan?

redrose 11 asked:

About a year ago, I bought nissan rogue 2008 and took a loan from them of 25000 with 7.5% interest rate. At that time my credit was not so good. People have been telling me that its a lot. Now my credit score is 720. Can you tell me which bank can give me low interest rate if i refinance my car?
I’ll appreciate your responses.


October 1, 2010

Auto Loan Interest Rate – Eight Steps to the Lowest Rate

Andrina James asked:

How To Get The Best Interest Rates On Your Auto Loan

Do you want to get the lowest possible auto loan interest rate for buying your dream wheels? It’s not a tough task if you go about it the right way. Interest rates may rise and fall, but whatever market conditions may be like you can beat them if you play it right. After all you never know when you may need to buy a car, so you should be able to do it without getting fleeced, no matter what the interest rates are at that moment.

Eight Steps To Finding The Cheapest Car Loan

Here’s the lowdown on how to get the best auto loan interest rate whenever you choose to go for it:

1. Build up a good credit rating: Lenders always prefer people with good credit history, so if you have any pending payoffs, finish them as soon a possible. Even if you have a less-than-good record you can make amends. If you start working on it at least 6 months in advance it shouldn’t be too difficult to make a good credit rating.

2. Do your homework: If you have time, find out the market conditions such as the prime interest rate before shopping for car finance.

3. Where down payment is concerned size does matter: Pay up as much as you can as upfront. A 50% down payment will get you a much lower rate than say a 20% down payment.

4. Go online: Most auto finance companies are accessible online, and the application process is much faster and simpler there. What’s more you get to compare many offers at one go.

5. Haste makes waste: Don’t be in a hurry. You may end up paying more for your auto finance than you should. Take time to consider various offers and compare them on vital parameters.
6. Read the fine print: Sometimes there may be hidden costs that are not revealed until you’re already in. Ask as many questions you need to before you sign up for that cash advance.

7. The refinance option: If you haven’t been able to improve your credit in time you can still make up for it later by going for a refinance cash advance. This will give you enough time to improve your ratings and then save on rates.

8. Get to know your loan before you plunge: Understanding how the advance works can help you save on interest. Interest rates are affected by various factors like the term of the cash advance, and the age of the car you’re buying. Knowing what affects the rates will help you minimize your interest payments.

Armed with these guidelines you can be sure you’ve done all that’s needed to get the best possible auto loan interest rate for your vehicle purchase. All you need to do then is sign up for the auto finance, buy that car and drive away without a care!

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