While many think the best way to finance a vehicle is by simply going to the dealership, picking a car, then taking the loan the dealer offers, the truth is that they could have found a better loan if they had shopped around online. The average markup for an auto loan at a dealership is 2.5%, which might not seem like a lot until you do the math on how much interest you will be paying altogether. So, where can you find the best place to get car loan online?
First Things First
Before accepting any financial loan, it’s important to know what you are eligible for. The easiest way to find out is by checking your credit score. In the past, this meant paying money and slightly decreasing your score at the same time, but with online sites like Credit Karma anyone can view their credit score for free.
Knowing your score allows you to find out what kinds of rates and monthly payments you should expect. If your score isn’t exactly perfect, don’t stress over it. Paying off an existing loan or any outstanding bills can give your credit the boost it needs, opening up plenty of opportunities for lower rates.
It is also highly advisable to use a loan calculator to give yourself a ballpark estimate of what you would pay altogether based on the length of the loan. This way, you can identify when a lender is offering less than what you deserve.
Comparing Lenders Online
Before even speaking with a lender, it is imperative that you check into their track record. Various websites will let you compare lenders side by side, view their pros and cons, review customer experiences, and see the types of rates you can expect from each.
Once you have found a few reputable lenders with rates and features that work best for you, contact them all within 14 days. Each time a lender checks into your credit history, it will drop your score slightly. This 2 week time frame allows for that minor decrease to be quickly recovered with a few monthly payments.
What to Look For
The best lenders will offer loans for both new and used cars, refinancing options, and the ability to buy out a lease. Instant or same day online approval is a must, as are valuable resources like payment calculators, helpful articles packed full of advice, and general shopping tips. They will have a track record for excellent customer service, especially without a 1-800 number leading to uninformed service representatives.
You can also use state and federal sites, as well as the Better Business Bureau to find out just how good or bad a lender’s rating is.
Putting Yourself in the Driver’s Seat
The market for car loans is highly competitive, and you can take the fierce nature of company’s competition to your advantage. Regardless of your credit, using the online tools available to you and comparing lenders might be a little tedious, but will greatly work to your advantage. Make sure to ask about any special incentives and possible discounts, even if they are not advertised.
Push for the best loan terms possible, and settle for nothing less than you deserve. With the above tools and advice, you will never fall victim to the pitfalls of a terrible auto loan again. Skip the dealership, and put yourself in control of your loan options!