Avoiding Long Auto Loans
by john sims
Do you really know how long is too long when applying for a new auto loan? According to many studies, the answer to that is no. Too many buyers nowadays are looking for the longest auto loan possible, without looking at all that it entails. The average auto loan is now around 70 months, which is up from the standard 60 months just a few years ago. There have even been reports on 9 year loans taken out for the higher price vehicle. The trend of getting a longer auto loan for a more expensive car is one that is more than a little troubling.
Quite simply, the longer you take a loan out, the more interest you pay. Therefore if you buy a $30,000 vehicle, which is about the U.S. average, and you take an auto loan for 7 years you are paying approximately $38,000 for that car and that is only if you have excellent credit. The worse your credit, the more you are going to pay. By changing a 7 year loan to a 4 year loan, it will save you almost 50% in interest!
Not only will you be saving money on your auto loan, but you will also be helping the value of the car considering most people won't keep their car more than 3 to 5 years. That means you may be what is called "upside down" on your car loan with no down payment. Being upside down means that you will owe more than it is worth. That makes it harder to trade it in, and will cause you higher auto loan payments not only for the car you are in now, but the cars in the future. Next to buying a home, an no down payment car loan is one of the most expensive purchases you will make, so make sure you are doing the right thing for your investment and your future.
Showing posts with label Auto Loans. Show all posts
Showing posts with label Auto Loans. Show all posts
Tuesday, April 7, 2009
Wednesday, April 1, 2009
How To Get Quotes Fo Bad Credit Auto Loans
How To Get Quotes Fo Bad Credit Auto Loans
by Christopher Wright
The basic necessities. Food, water, shelter, and a Mercedes Benz. OK, maybe not a Benz, but you do need a vehicle to get back and forth with. Only one problem...bad credit. Or is it really a problem. Today's lenders are very aggressive in their lending practices, so there just maybe hope yet.
One of the first things to understand about bad credit auto loans, has to deal with your credit file and score. At what stage is your bad credit status? Past bad credit is better than present bad credit. Present bad credit demonstrates that you're having problems with your cash flow. It means that maybe you're not a responsible applicant. If your bad credit is from the past, you'll have a better stance when getting your auto loan quotes.
There are several things that you should be aware of when applying for a bad credit auto loan. You may be required to place a larger amount of cash down payment compared to someone with A+ credit. Also, expect your interest rate to be higher. Don't fret though, all is not lost.
You can improve your chances of getting a better interest rate with a lower down payment with the use of a co-signer. This helps reduce the lending institutions risk. An example of this situation, is when parents cosign a car loan for their children. One other advantage for you, the borrower, is the advances in technology. The Internet has changed the way many businesses are operated and the car loan financing industry is no different. You can use the Internet to obtain multiple quotes online. Many people like this option, as it gives them a sense of control. This also reduces the intimidation factor some people feel when requesting funding from a loan officer in person.
by Christopher Wright
The basic necessities. Food, water, shelter, and a Mercedes Benz. OK, maybe not a Benz, but you do need a vehicle to get back and forth with. Only one problem...bad credit. Or is it really a problem. Today's lenders are very aggressive in their lending practices, so there just maybe hope yet.
One of the first things to understand about bad credit auto loans, has to deal with your credit file and score. At what stage is your bad credit status? Past bad credit is better than present bad credit. Present bad credit demonstrates that you're having problems with your cash flow. It means that maybe you're not a responsible applicant. If your bad credit is from the past, you'll have a better stance when getting your auto loan quotes.
There are several things that you should be aware of when applying for a bad credit auto loan. You may be required to place a larger amount of cash down payment compared to someone with A+ credit. Also, expect your interest rate to be higher. Don't fret though, all is not lost.
You can improve your chances of getting a better interest rate with a lower down payment with the use of a co-signer. This helps reduce the lending institutions risk. An example of this situation, is when parents cosign a car loan for their children. One other advantage for you, the borrower, is the advances in technology. The Internet has changed the way many businesses are operated and the car loan financing industry is no different. You can use the Internet to obtain multiple quotes online. Many people like this option, as it gives them a sense of control. This also reduces the intimidation factor some people feel when requesting funding from a loan officer in person.
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