How to Shop for a Car Loan
Money

How to Shop for a Car Loan

(Image: File)

(Image: File)

Don’t count the dealership out. Chances are the dealership may offer you the best financing terms. But it’s still important to do your homework beforehand so that you have comparison offers and favorable options. They’re likely to offer lower interest rates if you have an automatic payment drafted from your account, so be sure to ask about these and any other discounts.

Tips:

  1. Don’t roll your current loan into your new one. This will make you upside down on the car, meaning that you will owe more than it is worth.
  2. Pay off your car loan as quickly as possible. This will give you a lot more financial freedom and help you to break the car loan cycle. You may also consider joining a car share while you save up money, a good option if you live in a big city.
  3. Don’t be afraid to negotiate the price. Since you are not financing with the dealership you may be able to get more money off, since they are not taking a risk on lending you the money.
  4. Have the car checked by a mechanic, especially if you’re not an expert on cars. This will prevent you from buying a car that will need significant repair work or that has been in a serious accident.

×