Points To Ponder Before Applying For A Car Loan

Writen by Robert Parker

Have you got an eye on the new Vantage? Or do you want that sparkling new Jaguar parked in your driveway? Guess what all this is no longer a dream! You can drive your favourite set of wheels by availing car loans.

Getting car loans is not a daunting task any more, but your goal should be to get the best rates on car loans. Here are a few tips to help you attain low rate car loans:

Improve your credit score: Before you go out hunting for car loans, your first priority should be to find out your credit score. A good credit history will help you negotiate for a better deal on car loans. Conversely, you may have to bear the burden of high interest car loans. So make sure you pay your instalments regularly especially for a few months prior to availing car loans.

Do your homework: Remember that the car loans market is very competitive and you being the buyer have innumerable choices in car loans. So you don't have to agree to the first offer that comes your way. Shop around for good deals in car loans in terms of interest rates, repayment terms and other fees. Internet is considered a viable medium to do all such shopping for car loans. By applying online you receive several quotes for car loans from several lenders, thus giving you more freedom to negotiate.

Weigh your options: When shopping for car loans keep in mind that smaller the amount you borrow, lesser is the interest rate. So if you offer a good amount as down payment, it will prove favourable to you in the long run. Also, give due consideration to the different car loans options available to you. If trading-in your car is cheaper than negotiating with a car dealer, then go for it.

If your reason for buying an automobile is to just get you from A to B, then why not go in for used car loans. This is especially helpful as unlike home that grows in equity, the value of a car always deprecates with passing time. There are a lot of lenders who will give you affordable deals on used car loans.

What most people are unaware of is that you can even refinance your car loans. Like remortgaging, you can also trade-in your current car loans for new ones in favour of low interest rates or longer payment period.

Shopping and negotiating will ensure that you get the best deal in car loans.

About the Author: The author is a business writer specializing in finance and credit products and has written authoritative articles on the finance industry. He has done his masters in Business Administration and is currently assisting Ecar-Loans as a finance specialist.