Apply For Both Auto Loans and Have Them Compete Against Each Other!

Auto Loans

It’s that time again and I am ready for a new car. Prior to actually shopping for my new car, I decided to do things a little differently and get pre-approved for an auto loan in advance. It was so nice to have everything done and negotiated prior to arriving at the dealership. There was no hassle or worry about qualifying, as my auto loan was pre-approved and hassle free. Here is how I did it:

First, I looked into various car buying tips related to auto loans because everyone always says that “knowing is half the battle.” One of the best tips I discovered was that you should really know your credit score and what your score means because it is a very important part of the process of buying a car. Knowing how your credit score effects you will, in turn, help you to negotiate lower interest rates than your lender may be offering on your auto loan. There are many different websites online that provide credit reports and scores, some are even free!

Secondly, I asked myself “how much can I afford?” I was not sure how to answer this as there were so many variables to consider. A good formula that was presented to me was to look at your gross monthly income and divide it in half and then subtract all of your monthly bills out of that amount. For example, your rent, credit card payments, loans, power bill, etc. Then, take the balance that is left over and multiply it by 40%, and that should be what you can afford as a monthly car payment.

Next on the list was getting pre-approved for my auto loan! Now that I knew how much I could afford to spend on my new car, I started on the auto loan process before even going to the auto dealer. I found an online lender that I was very comfortable with and applied for my auto loan online. There were several large online lending services to help me find the best loan to fit my needs. Having my pre-approved auto loan really helped me from overspending and it really forced the dealer to work within my budget to give me the best deal.

Then it was on to finding the right dealer. You want to have a good experience that the car dealership when picking out your car and on your test drive. I did a search on the dealerships in my area and looked into how they were rated in their standards of customer service and satisfaction. When I personally select a dealership, I try to select one that will also be able to provide all my car service needs after I purchase my new car.

I found it to be important to do a ton of research prior to negotiating a fair price for my new vehicle. Even though I had already worked out the details of my auto loan, I wanted to also be sure that I was purchasing my new car for an equally good deal. I researched the value of my trade-in, in addition to the exact price of the car that I wanted to purchase with all of the extra bells and whistles. I basically told the salesman, “this is what I want for my trade in, this is what I am going to pay for my new car, and here is the information from my pre-approved auto loan.” They came back and said, “Congratulations! You are a new car owner and it will be ready to be picked up in a few hours.” It was so simple and hassle-free that I will always go this route for now on. By having a pre-approved auto loan, I was able to shop with confidence and power while getting the exact car that I wanted.