Pay less, always. So, are you in the market for a new car but are worried about the cost of financing? Don’t worry, there are ways to get a cheap car loan and save money on your car purchase. Here are some tips to help you secure a low-interest car loan:
- Shop around: Don’t just go with the first lender you find. It’s important to compare rates and terms from multiple lenders to see which one offers the best deal. This can include banks, credit unions, and online lenders. DO NOT just take the dealer’s financier.
- Negotiate the price of the car: The lower the price of the car, the less you’ll need to borrow and the lower your monthly payments will be. Be sure to negotiate the price of the car with the dealer before applying for financing. Be willing to walk away.
- Improve your credit score: A higher credit score will typically qualify you for lower interest rates on a car loan. If you have a lower credit score, consider taking steps to improve it before applying for a loan. This can include paying off debt, making timely payments, and checking your credit report for errors.
- Opt for a shorter loan term: While a longer loan term may lower your monthly payments, it will also result in paying more in interest over the life of the loan. Consider opting for a shorter loan term to save money on interest. A longer-term loan is penny-wise but pound-foolish.
- Consider a secured loan: If you have a savings account or other assets, you may be able to use them as collateral for a secured loan. This can often result in lower interest rates compared to an unsecured loan.
- Make a larger down payment: The larger the down payment, the less you’ll need to borrow and the lower your monthly payments will be. Consider saving up for a larger down payment to reduce the overall cost of the loan.
By following these tips, you can get a cheap (well cheap-er) car loan and save money on your car purchase. It may take some extra effort and planning, but the long-term savings will be worth it.