Auto Loan Tips

Top Auto Loan Tips - Good Credit

• Run the numbers. This auto loan tip is the one most commonly skipped. Use our car loan calculator. to walk step-by-step through planning your auto loan. Pay particular attention to Step Two where you will estimate your interest rate.

• Get multiple quotes. This may seem like a shameless plug and not auto loan advice, get multiple loan quotes before heading to the dealership. Whether by submitting SmartCarCredit's easy auto-loan-application or calling multiple auto finance companies yourself, your score enables you to shop widely for the best rate. Don’t worry about multiple credit inquiries. According to Fair Isaac (the people behind the FICO score): "Looking for new credit can equate with higher risk, but most credit scores are not affected by multiple inquiries from auto or mortgage lenders within a short period of time. Typically, these are treated as a single inquiry and will have little impact on the credit score."

  

• Put your credit score to work. This is particularly true if you have A (720+ FICO) credit. Borrowers in the top credit tiers have alternatives and dealers know it. Politely let the dealer know that you are going to compare their rates to the competition.

• Understand how auto dealers work. Know how sales people are compensated. Learn to spot common tactics and tools (such as the 4-square) that are used to weight the deal in the auto dealer's favor. Know the basic auto loan terminology.. (Deep-dive into auto loan terms here.)

  

• Be ready for the Finance & Insurance (F&I) office. Our car loan advice page walks you step by step from setting your budget to negotiating terms with the F&I Manager.

• Consider skipping the dealer altogether. Your credit score qualifies you for a breadth of loan and lease options. Throw the door open to the best car deal. An auto broker can save you a lot of legwork by locating and negotiating for that new car purchase. Just keep in mind that auto brokers may receive a dealer bounty. If you've done your research, you can keep their commission and the final price in line. Considering a used car? A great auto loan tip is to go with a car buying service. While they canvase wholesale inventories to get the best deal, they often have more lender relationships than a single dealer.

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Related Links

• Considering a used car? Read our used car loan tips.

• Understand your alternatives. Get auto loan quotes here.

• Know how much you can afford. Calculate your payment and loan amount.

Disclosure: We developed the content for SmartCarCredit™ while working with automotive industry clients. We hope you find it helpful in making informed decisions. While we believe the information to be accurate, we do not guarantee its accuracy.