Getting a Good Interest Rate on Your Car Loan
There are a number of tactics you can employ in order to get a good interest rate on your car loan.
Getting the best possible interest rate on your car loan can result in saving a great deal of money over the term of the loan. It is a good idea to look around and research possibilities before choosing to get a loan from a particular lender or dealer. A one percent difference in interest rates can make a big difference in how much you pay over the life of your loan.
Improving your credit
One of the best things you can do to get a better interest rate on an auto loan is to work on improving your credit. This is one of the biggest factors in the interest rate you are offered by a lender. Improving your credit score can make a big difference.
Shopping around for a good car loan interest rate
Instead of sticking with the first lender, shop around for interest rates. See which lenders offer the lower rates. Word of caution: avoid getting actual credit checks, if possible. If you have more than a couple credit checks in a couple of months it can negatively impact your credit report and score. You can usually get ballpark figures from loan officers by sitting down with them and being explicit about your finances.
Getting a car loan during a “loan sale”
Many lenders offer “loan sales.” These are special events in which the lender offers special, lower interest rates on car loans. You can get a better deal if you apply for your auto loan at a time when the lender is offering better interest rates on auto loans.
Look for a car loan online
Many online lenders offer good deals on car loans. Even more traditional lenders often offer special, lower rates for online car loans.