How to Win the Auto Financing Game
How most people focus on the price of a new car and let themselves get shafted on the terms...
Most people don't understand the importance of taking advantage of a site like mycredittree.com. Back in the days of the "no money down" craze in the real estate market of the late '80s, one "guru" made a point that people should keep in mind even today. "I want to buy your house right now, I'll pay any price you want but I set the terms.", he would state looking around the crowded room with challenge in his eye. Eventually someone in the audience would shout out some number he or she considered ridiculous, "A hundred million dollars!!!".
Auto Loan Financing Tips & Scams to Avoid.
Here are answers to some questions people commonly ask about auto financing.
1. Where can apply for auto financing at a low rate?
Don't accept financing from the dealer right away. Get quotes form other sources and then compare. You can easily get a free quote online in minutes. I recommend mycredittree.com.
2. Mistake everyone makes - Applying for auto loan without knowing your credit score?
Don't apply for auto loans without knowing your credit score. People with bad credit will end up paying high interest on their loan if they are not careful. Use consumerdirect.com and find your credit score. Its free.
3. I have bad credit what do I do?
Having a bad credit is not end of life. One smart thing you can do is fix your credit. I recommend consumerdirect.com. However, You can still get a low rate auto loan even if you have bad credit from mycredittree.com.
"Sold!", said the guru, "My terms are no interest, no payments, and a balloon payment of the full amount, due in 200 years."
Of course, these deals were never consummated. They were just a sensationalistic way of making the guru's point. That is to always keep in mind that with any purchase, there are 2 equally important factors: the selling price, and the terms under which that price is delivered.
Many people are aware that the way to get a good price in a car is to do your homework and know what you should be paying before beginning the buying process. This is where most people leave it - and this is a huge mistake. The truly wise shopper knows getting a reasonable price is only half the equation, the other half is being sure to shop for the best car loan rates.
This is a failing of human nature that the car dealers depend on. They know a certain percentage of shoppers will do their homework and make certain they are getting a good price on their new car. However, flush with victory and pride in their negotiating skills, these same smart shoppers often walk into the dealer's finance office like lambs to the slaughter. They forget that crucial second part of the purchasing equation - getting the best terms possible on their financing.
Luckily, the answer to getting a good price on a car holds true for getting good financing as well: do your homework. Walking into a car dealership knowing you have already taken care of financing puts you in the ultimate position of power. The secret here is: Don't mention that you have your own financing until the price has been negotiated. The car dealers always remember both sides of the purchasing equation. They will negotiate on price as long as they think they can make up the difference when it comes to the financing. If you tell the salesperson up front that you have your own financing, you will find that most dealerships become much, much more stubborn when trying to negotiate a better price. So keep your mouth shut about the financing until a firm offer for a fair price has been accepted.
When you get a fair price and good terms on a purchase, then you can bask in the pleasure of getting a good deal. Doing your part and getting yourself one of the low interest car loans from mycredittree.com is your way of guaranteeing yourself that good deal.