Do you need to purchase a car but also save money in the process? The best auto loans in 2021 get you the vehicle you need at an affordable price. Car loan financing is not limited to loans offered directly through an automobile dealer, but what types of lenders offer the best car loan rates on the market today?
It is essential to learn how to save money with better auto financing rates when shopping for car loans today. A credit union car loan is one financing option many consumers overlook. How do I find the lowest auto loan rates for my budget? Read this guide on how to save money with low rates on auto financing in 2021.
The excitement of buying a new car sometimes eclipses the idea of budgeting for the purchase in advance. Effective strategies for saving money with better auto financing rates involve careful research and planning.
Finding the best auto loan rate available for your choice of vehicle might involve comparison-shopping between multiple lenders and searching for unexpected options. The annual percentage rate (APR) on your car loan is one of the primary factors impacting the cost/amount of your monthly installments.
Your credit (FICO) score is the main factor affecting the APR assessed to your loan. Therefore, the first place to look when looking to save money on a car loan is not necessarily at various lenders and rates, but rather at your own credit report.
A common strategy to get the best car loan rates today is to bump up your credit score using verifiably effective methods. The first step is to obtain your FICO score and a copy of your complete credit history from Equifax, Experian and TransUnion. The U.S. Federal trade Commission (U.S. FTC) and the AnnualCreditReport.com websites both allow you to pull your entire credit history including your FICO score from all three reporting bureaus once a year for free.
How do I bump up my credit score once I have my full report? Paying all your bills on time for an extended period is the primary way to maintain a good credit rating. Getting the lowest car loan rates possible when you have an adverse payment history takes discipline and patience. It is essential to repair your payment history by making on-time payments for 6-12 months prior to applying for any auto financing.
Do you have any erroneous charges on your credit report? Dispute and overturn any reported delinquencies made in error.
Additional ways to bump up your credit score include:
- Divide your payments across different accounts to avoid maxing out available credit.
- Use your credit cards for regularly weekly/monthly payments for which you already have the money & pay them off in full every month.
- Pay more than the minimum payments due on all accounts.
- Transfer high interest revolving credit card debt onto new accounts with zero-interest balance transfer rates.
- Make payments bi-monthly instead of monthly.
- Prioritize paying off revolving debt over other types of debt/accounts.