We’ve all been there - the excitement of getting a new car. You’ve done the deal, the papers are signed, the dealer has handed over the keys, you’ve taken it home and let all your friends admire it. Then the doubts set in… How do you really know that you got the best deal on your car loan?
Thing is, you should definitely start asking this sort of question before you ever even set foot inside a dealership. When you go shopping for a new car well prepared, with all the facts and figures you might need, it can really help cut down your stress levels with such a big purchase! Plus, if you’re prepared in advance, you don’t spend the next five years thinking “did I really get a good deal on this car loan?”
First up, take a look at your car loan history. Have you ever taken out a finance deal on a vehicle before? Did you make all the payments when they were due? Did you pay the loan off early? Or was your vehicle repossessed if you fell behind with payments. Your previous car loan history is one of the most important factors in whether you get the car loan deal you want.
Next up, get all the information about the car you want to buy - make, model, year of the vehicle. All this stuff is important. If it’s a brand new car, you might want to check into what the future resale value might be, and whether it’s considered a reliable vehicle. If you’re buying used, check with other people who own the same model to see how well their car has performed over the years.
Now you’ve done this preliminary work, the next important step is to look into insurance for the vehicle. There’s no point in leaving this until after you’ve picked the car of your dreams - there’s nothing worse than setting your heart on a high performance sports car, and then discovering the insurance is so high you can’t afford it! Also, it’s a fact that almost all dealerships will want to see proof that you have insurance in place before you drive away in your new car.
With all of this done, you’re probably just about ready to head out to the showroom and pick out your new ride, but hold off - you’re not ready just yet! Before you start talking to dealers and negotiating on price, you should put some time into researching loans by yourself. Despite what a lot of people think, you do not need to take the loan the dealership offers you - you can arrange your own financing yourself, and if you can find a better rate, you should take it!
It’s important to set aside a few weeks to apply for loans and get approval on them. Also, remember that even if you’re approved, you don’t need to take the loan. Compare the details of the loans you get approval on and look to see which has the best deal for you personally. One of the most important things here is the lowest interest rate.
Now you’ve sorted all these things out, you can head off to the car dealer. Negotiate on the car you want, and get the best deal you can negotiate. Then, let the dealer know that you’ve already got financing in place, but you’re willing to take a loan through them if they can offer you better terms. Oftentimes they can go even lower on interest because if you take a loan through them, they make more money. With these tips, you’ll know how to get a good deal on a car loan, and you can stop worrying when you’re driving your next new car home!
Tags: car finance