How to do your homework before financing a car?

Alger Antoinette  2019-09-04 17:58:55

Now you want to realize your dreams—buying your first car. But what do you do? How do you get the money for it? When an individual decides to buy a new or used car, he or she often needs to finance part of or all of the vehicle’s price. Because cars are such a big purchase, many buyers can't provide cash down for the vehicle, so they choose to finance a car over a period of time. To save money, you should prepare information or related materials in advance.

  1. 1Find out how much you can afford up front. If you know the ballpark value of what you want to pay for a vehicle, and how much you can afford to pay in cash, you will know about how much you will need to finance.
    • 2Know your credit score. Much of the financing offer for a car is based on your credit score. Those with good credit will get better interest rates and cheaper car financing offers. This is important no matter who you finance your vehicle through. You can find out your credit score through the dealer or online ways. If your credit score is higher than 680, you are considered a prime borrower and are eligible for the best interest rates available. The higher your score, the better bargaining position you will be in.
      • 3Compare loan rates online. There are many websites that compare deals at no cost. Additionally, it is a great way to get in contact with various companies.
        • 4Get the necessary materials together. Most lenders will want your name, social security number, date of birth, previous and current addresses, occupation, proof of income, and information on other outstanding debts.