If you have been dreaming of a brand new car, you might be tempted to take out an auto loan on the spot with the car dealership. While it might be your dream car, you better think twice before you agree to on the lot financing. Before you sign on the dotted line for any auto loans be sure to keep a few of the following tips in mind so that you make the best decision for you and your family.
There are many car dealerships that offer you the financing you need and desire to purchase the car of your dreams right there on the spot. While this can be quite appealing to you, mainly because we live in a “got to have it right now” society, it is sometimes a poor choice. Many of these car dealerships will offer you loans at a much higher interest rate than you could possible get with a bank. Be sure then to take your time and check out every possible interest rate available to you before you settle for a high one with the car dealership.
Before you begin your search for a new car, it is best to go ahead and get yourself pre-approved for the loan. This is true when buying a home and is also true when buying a car as well. Make sure even after you have been pre-approved that you get the loan approval in writing. This way you will not be surprised by a loan falling through on you. A pre-approved loan that falls through at the last minute can be quite embarrassing and devastating especially if you have your heart set on the car.
When you head out to purchase a new car and your current car is not completely paid for already, many times car dealers will offer to stack your loans. This is where they pay off your old car for you and then finance your new car. This may seem really great but in fact you are going to be paying more for the new car then you expected because the dealership has just stacked the left over owed amount from your car onto the new car loan. This happens when your trade in value is not enough to pay off your old car. Don’t let this happen to you.
If you are careful to do your homework before you start looking for loans of any kind, especially a car loan, you will be able to make a good decision and one that will not cause you unnecessary financial stress in the end. Also be sure to take someone with you to the car dealerships, perhaps your husband, so that you will not be taken advantage of by the car salesmen. If you go alone, you are more likely to buckle and take whatever deal the dealership offers you without questioning it. Do not let this happen to you!
Great Basin Federal Credit Union helps people acquire loans in Sparks Nevada. Find out more about how to qualify for a low interest rate loan at GreatBasin.org.