In this day and age with the price of cars being so high, not many people can walk in\u00a0and pay cash for a vehicle. The dealers want you to believe that you have to finance\u00a0with them, but this is because dealers make money on financing from banks or credit<\/p>\n\n\n\n
Unions that they work in partnership with. Before you walk into the dealership, you want\u00a0 to be armed with information so that you can finance your vehicle on your own terms.<\/p>\n\n\n\n
The dealers will ask you what you want your monthly payment to be. This may make\u00a0your loan last for a longer number of years in order for the loan to fit into the payments\u00a0 that you want.<\/p>\n\n\n\n
What you really need to focus on is the amount of money you want to borrow, the\u00a0number of years you want to have a loan for, and what the interest rate is. With these\u00a0three pieces of information, a simple loan calculator on Google will give you your\u00a0monthly payment. Do this before stepping foot in the dealership.<\/p>\n\n\n\n
I used to recommend five-year loans for my customers. With the cost of cars increasing\u00a0and the lack of discounts on vehicles, sometimes people have to go to a six-year loan,\u00a0which seems to be the average right now. In the rare instance that someone needs to\u00a0do a seven year car loan, we will recommend it.<\/p>\n\n\n\n
Look at it this way: when your car is six or seven years old you will still be making car\u00a0payments on it. Do you want to be making payments on a seven year old car? Most\u00a0people pause and say I never looked at it that way. A lot of people don’t want to be making car payments for seven years, especially when you start doing some\u00a0maintenance that needs to be done as well.\u00a0\u00a0<\/p>\n\n\n\n
You want to research banks in your area, local credit unions, or any credit unions you may belong to. Check with AAA if you are a member, and your credit card companies,\u00a0as they offer car loan rates too. You also want to know the terms that you want to\u00a0finance. Look at all the different variables to see what works for you because some\u00a0banks or credit unions will offer better rates for a five year versus a six year. Also, if you\u00a0know the type of vehicle you want to buy then you want to go on the manufacturer\u2019s website site to see if they’re running any finance incentives. Sometimes these are the\u00a0best rates that you can get in the current economic market.<\/p>\n\n\n\n
So before you walk into a dealership, you know what the best rates are and you have\u00a0an idea of the amount you want to borrow. You will know approximately what your\u00a0monthly payment will be. As stated earlier, the dealer will have you focus on the monthly\u00a0payment. You will need to ask very pointed questions such as \u2018What is my rate\u2019 and\u00a0\u2018How many years is the loan for\u2019? They like to avoid these conversations but it’s\u00a0important you ask these questions before you sign any paperwork.<\/p>\n\n\n\n
With the current lack of inventory, the dealers sometimes require that you finance\u00a0through them in order to get the vehicle you want. This is one of the first questions you\u00a0should ask them, if you can bring your own financing or are you required to finance\u00a0through the dealership? If you are required to finance through the dealership, can they\u00a0give the special rates that the manufacturer is offering? Are they marketing competitive\u00a0rates from banks and credit unions in the area? Typically the
standard rates from\u00a0manufacturers are the highest rate.<\/p>\n\n\n\n
This is where the negotiation comes in and you need to say I’d like to bring my own\u00a0financing. Here’s the rate I can get if you can match or beat it I am willing to use your financing otherwise I’d like to bring my own.\u00a0\u00a0<\/p>\n\n\n\n
If they want you to finance through them, check the place with the best rates and make\u00a0sure they allow refinancing so you can get the car and turn around and refinance the\u00a0loan as soon as you get the paperwork at no additional cost to you. The dealers will\u00a0lead you to believe that you have to hold the loan for three to six months but that is only because they get the credit for the loan at that time. Typically, there are no prepayment penalties for car loans and you refinance right away.<\/p>\n\n\n\n
The most important thing is to be armed with information before you walk into the\u00a0dealership.<\/p>\n","protected":false},"excerpt":{"rendered":"
In this day and age with the price of cars being so high, … <\/p>\n