Purchasing a vehicle can be an exciting experience—and also a little intimidating if you haven't done your homework. Many of our customers tell us that shopping for a car loan is just as challenging as shopping for a car. Gary LaPointe, the F&I manager at Star Auto Sales, shared his many years of automotive financial knowledge and together we came up with tips to help find a car loan right for you. Whether you’re about to apply for a car loan or still thinking about it, use these 4 tips to help you navigate the waters of financing a car.
Check Your Credit
Before you start shopping for a car, check your credit. The better your credit the easier it will be to get a loan. Higher credit scores will have lower interest rates. Having less than perfect credit doesn’t mean it’s impossible to get a loan for a car, but you may end up paying a higher interest rate for the loan.
If you have a low credit score you may want to improve your credit so you’ll have lower interest rates. It’s also a good idea to check your credit report and dispute any errors such as late payments or incorrect totals.
You are entitled to a free credit report from each of the three credit reporting agencies (Equifax, Experian, and TransUnion) once every 12 months. You can request all three reports at once, or space them out throughout the year.
Know Your Budget
Knowing how much car you can afford and setting a budget is essential. If you don’t have a budget in place, start with your monthly income after taxes and subtract your monthly expenses. Now you can figure out what you can set aside for a car payment each month.
Determine How Much You Can Afford
Once you understand where you are financially, you can decide on a reasonable monthly car payment. For many, a good rule of thumb is to not spend more than 10% of your take-home income on a vehicle.
Now you’re ready to look for a new ride. Put in a little time for research, and find cars that are known to be reliable and fit into your budget. You’ll also want to consider size, color, gas mileage, and extra features.
Shopping for a car and navigating financing options can be overwhelming. Star Auto has helped hundreds of people like you get a car and a loan that’s just right. We can help you. Call us at 203-630-2926 or fill out our easy quick-qualify form >>here<<.