When shopping for a car, settling on the make, model and style seems like a daunting task, but it may be the easiest part of your car buying experience. For many buyers, the real difficulty and confusion sets in when financing comes up. But committing to an auto loan will be much less intimidating if you have a full understanding of the most important details in your contract.
Getting All of the Facts
When ironing out the terms of your vehicle financing, the car salesman may try to politely rush you into signing before you are truly ready. Don't let that happen. With equal politeness, stand your ground and make sure that everything is perfectly clear to you. Ask the right questions about the terms of your agreement and hold out for answers that make sense.
What interest rate am I really paying? The APR (Annual Percentage Rate) that you will pay on your loan is a determining factor in how much your car will actually cost. Whether you will get a higher or a lower interest rate largely depends on your credit score, but make sure that you are being offered the best rate possible.
What (if any) potential penalties are attached to the loan? You should know if you will be charged a fee for paying the loan off early (very rare nowadays) or if any other type of payment behavior (i.e. late payments) could result in extra charges.
Is the deal that you're being offered contingent on third party approval? If a dealer allows you to drive off the lot without absolute approval from a financing institution, you could be told a couple of days later that something has fallen through and that A) the dealer can't get you approved at all or B) your loan deal is going to be much more expensive than you were originally told. This is often referred to as "yo-yo financing."
What is the total amount being financed? A lot of car buyers make the mistake of focusing on the monthly payments instead of the entire cost of the vehicle. And, unfortunately, this kind of thinking makes it easy for dealers to sneak in costly add-ons such as rust proofing, fabric protection or extended warranties.
Get Your Financing Taken Care of First
Let Drivers Lane help you to get the hard part out of the way. We will assist you in determining exactly how much you can spend before you start car shopping, so that your buying experience will be easy and hassle-free. And don't let a problematic credit history keep you from getting the reliable transportation that you need. We work with all types of credit and will do everything that we can to get you approved. Just fill out our fast and secure online application to get started today!
