Car Loan Rates - What Influence In Low Loan Rates

Car Loan Rates - What Influence In Low Loan Rates

by apurva

Car loan rates have been a point of concern for all people who are interested in buying a new car. There are numerous companies offering seemingly interesting cheap car loans. However, low car loan rates no doubt signify good deals on the car loans. It is important to be aware of the factors that can affect your chances of getting an approval for car loans.

The Basic Criteria For Auto Loan Approval

There are some basic conditions a borrower must comply with in order to get the required car loans approved. Those minimum conditions are enlisted below-

# Age: The borrowers must be 18 years of age or above

# Employment: The borrower must have been employed for minimum two years and belong to the same location where his residential property is located.

# Income: Usually, lenders require borrowers' income status to be minimum $2,000, if the borrower is applying for direct car loans.

# Physical Assets: Good condition of the borrower's residential property puts him at an advantageous position in order to get loan approval and low car loan rates.

# Credit Ratings: The borrower's credit rating score can drastically influence the interest rates. Better the status a borrower occupies, lower the interest rates tend to be.

Credit Report

Borrowers with good credit status can obtain a low rate which may be somewhere around 1% to 1.9%. However, there are poor credit auto loans for the people having bad credit history, but the interest rates tend to be higher than other auto loan programs. Hence, experts suggest individuals to get a copy of their credit report first in order to figure out to what extent they can expect the interest rates can be lowered. Take help from online credit reporting agencies like Experian, Equifax, TrueCredit, ConsumerInfo etc.

Types Of Lenders

The prime lenders can manage to devise auto loans with lower rates than any ordinary lending entities. Prime lenders include banks, credit unions and large scale lending entities. Banks offer low rates and help saving thousands of dollars. But, head towards the credit unions that beat banks in reducing the rates even lower. Be a member of credit union to get special low rates, extra features and many more advantages.

Individuals are recommended to check out the credit tiers. Consult loan officers at the banks and lending institutions about their credit tiers which are used to categorize credit standing of the applicants. The tiers are rates like A, A- and the like. Consulting prime lenders and their loan officers can help you with the guidelines and car buying tips along with low car loan rates.

At the end of the day, before you decide on the auto loan program and sign on the dotted line, look carefully for loopholes. Car Loans with low interest rates do not always mean large savings!