If you have bad credit and need to buy a car, there are ways to get auto financing. You may have to pay a higher interest rate on the loan you get, but at least you would have a way to buy a car. If you are in this position, there are three different things you could consider that might help you qualify for a lower interest rate when buying a used car.
Choose A Shorter Loan Length
Interest rates on car loans are based on many things, including a person's credit, but they are based on other factors too. One of the other factors that can affect the interest rate on a car loan is the length of the loan. Longer loans generally have higher interest rates than shorter loans, and you might want to ask an auto finance company about this. If you could get a lower interest rate by taking a three-year loan instead of a five-year loan, it might help you save a lot of money. You should realize that your payments will be higher, though, simply because you will be spreading the balance over a period of 36 months instead of 60 months.
Buy A Newer Car
Another factor that can affect the interest rates on car loans is the age of a vehicle. Brand-new vehicles usually offer the lowest interest rates of all, while used car loans have higher rates. If you look at your options with used cars, you may find that a loan on a two-year old car may have a lower interest rate than a loan on a 5-year old car. This is another factor you may want to ask an auto financing lender about. While you may have to pay a higher price for a newer car, getting a lower interest rate will help you save money on the interest you must pay for the loan.
Put A Larger Down Payment On The Car
The other factor that may also help you get a better rate involves the amount of your down payment. The interest rate on a car loan with no money down is likely going to be higher than the rate would be if you put a decent size down payment on the vehicle.
These are three good factors to look into as you start shopping for a used car and a loan to go with it. To learn more, contact a dealer that offers auto financing, such as Leopardi Auto Sales.Share
8 December 2016
My dad was a mechanic, but I never had any interest in cars when I was young. My dream was to become an accountant, and that is what I do for a living today. When I began my career, the stress of my job began to take a toll on me. One day, I visited my dad, and like usual, I talked to him while he was fixing up a car in our garage. He told me to switch places with him and began telling me what to do with them to help him repair the car. After just a half-hour or so, I felt more relaxed than I had in months. The rest is history, as they say, and I am now passionate about automobiles and auto repair. I also find blogging very relaxing, so I decided to combine my favorite hobbies and start an auto blog!