Check Your Credit Report

Visit the website set up by the federal government and get your credit report from each of the major three credit reporting agencies. Check your credit report for any mistakes, as these errors could cost you a lot of money. Check your credit score so that you have an idea of where you stand with any potential lenders. Work on improving your credit score for about six months in case buying a car isn’t urgent.

Explore Multiple Options

Just like you’ll shop around to get a great deal for a new car, you should shop around for options to get a great deal on your car loan. Two great places to start are community banks and credit unions. These are known to offer the best rates on car loans. Get preapproved for a loan, if possible. Remember that super-low interest rates are for people with excellent credit only.

Choose The Shortest Term

A longer tenure may make an expensive car seem affordable, but it drives up the total cost of the loan. You’ll end up paying much more in the long run because long-term loans have high-interest rates. Limit your car loan to a maximum of 48 months. It will mean a higher monthly payment, but you will be debt-free so much sooner and get to enjoy the car for a few payment-free years.

Beware Of Scams

Don’t drive the car out of the dealership until the financing is final. Buyers assume that the deal is done and drive the car home only to get a call from the dealer a few days later with bad news. They’re told that financing at the agreed rate wasn’t available, and the car must be returned, or a new high-interest deal must be agreed to; otherwise, you could lose your deposit, trade-in, and be charged a rental.

Look At The Final Price

Only negotiate on the total final price of the vehicle and not the monthly payment amount with the dealer. It’s better if you’re preapproved for a loan before you step into a dealership. That way, it’s up to the dealer to offer you a better financing deal, and it’s your job to bring down the price of the car via negotiations.