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Best Used Car Loan

Used cars in present days had become the perfect business for car traders. Because of the global economic crises people don’t afford to buy new cars and they choose used cars, same models. We all know that a new car becomes used car even if the owner used it just for few miles and the price of it is lower than a new one.

And for the deal to be even better, the buyers of the used cars usually get a loan if they can’t afford paying it cash so they don’t lose the best deal for the car they wish to drive. The best used car loan is the loan with the smallest rates, costs and without extra taxes. This is pretty difficult to find, but if you search long enough we will see that lease is the best loan. Because banks have bigger taxes than leasing companies, we better choose lease when we think about buying a used car.

Best Used Car Loan

Usually leases are having rates between 5.04% and 5.71% depending on the period of time for paying back the lease. Usually a lease contract can be in time from 36 to 48 months for used cars, but there can also be chosen different periods of time, depending on your agreement with the leasing company.

So, in order for you to choose the best used car loan, you better use the used car loan calculator. In this way you can calculate anytime your monthly payments, the costs of the loan and the taxes for every state you live in. For using this used car loan calculator you just have to fill few fields with dates about price of car, period of loan contract, and the calculator will tell you exactly your monthly payment or if you insert the monthly payment that you can afford the calculator will tell you what is the amount you can take from the financing company. In this way you will know for sure what car you can afford or how much you will pay every month so you avoid surprises after the signing the loan contract.

Where you can find the best used car loan calculator? This is a very easy issue. You can search on the websites that are specialized in selling cars or in providing information about cars, you can also find it on the leasing companies and banks websites or you can simply go to visit the financing company or your car dealer that has signed a contract with a lease or loan company and he has knowledge about the car loans and how to calculate monthly payment for you.

Very important for you to know is that you can get a loan for purchasing a car or you can get a loan or lease to refinance your old loan or lease if you find a better rate and better taxes than your old loan.

Used Car Loan

Since cars are an indispensable part of our lives, everybody needs them if they want to get anywhere fast. If you’re heading for one, the first thing that comes in mind is money. If you cannot afford a new one and you’re heading for a used one and realize that you still more cash than you have, there are still solutions. One of the most popular is a used car loan.

Ok so agreeing upon going for a loan? Good. The first think to do before even thinking of getting a loan is checking the car thoroughly. The best way to do so is go and get a Vehicle History Report. That will enable you to see all the stuff that’s been going on with the car. The History report cannot lie to you so you’ll know exactly what the car went through, crashes, eventual major repairs and other things that may affect authenticity and performance. Another important thing is getting the help of a certified mechanic to inspect the car from hood to wheels. The History Report may be clean as a whistle, yet if the car has not been properly maintained and just looks good, you’re in for an unpleasant surprise.

Despite the hard times created by the financial crisis. The car market is still running well so getting a car will not force you to have big expenses, if you know what to do and have a good plan ahead. Getting a loan for a car purchase has become easier than ever especially if you have a clean credit record. The simplest way is to access one of the websites that specialize in car loans like Up2Drive located at: http://support.up2drive.com/offer/?AID=10585121&PID=267874 and you’re good to go. In case of less than spotless credit records than getting a loan can be a bit trickier. You still have a good shot if you head for AutoCreditExpress at : https://www.autocreditexpress.com/sem/?lpgid=short&affid=ap001113&subid=7 . They are specialized in dealing with bad credit, bankruptcy or repossession.

Used car loan

Be careful when you go car hunting. Document upon every car you pick since no bank will lend you any money for a used car that is too old. If you see a manufacturing date older than 5 years wave it goodbye. Know that banks charge minimum 2% more on Annual percentage rate (APR) for every used car loan. Yet you may get lucky online since lenders there are way cheaper, and used car loan fees get closer to new car loan fees.

Remember: never ever put cash for a deposit on a car. If a problem occurs with the deal, you may never get your money back, since the action of placing money in a deposit was done willingly prior to a transaction. A credit transaction on the other hand can be disputed since it’s related to the very contract. If you don’t have one you can head for one of the thousands of offers from every bank. A popular credit card is the Discover Platinum card, or Discover Student Card, both of them having 0 annual fee, and are fully protected from fraud.

Before you buy the car, take into account costs like insurance and extended warranty (which is a must have in case your car falls apart). Some of the best auto insurance quotes can be received from Allstate, GEICO or BestCarInsuraceSite. If you’re going for an extended warranty, there is no better place to go than CARCHEX or WarrantyDirect. They can offer you unbeatable odds and good coverage for most car parts.

Car Loan Interest Rate

If you cannot afford to buy a car with cash, it means that you certainly are interested in learning new ways to lower the car loan interest rate. Here is what you should do:

First, you could pay extra payments on the loan as it will reduce your outstanding principal balance. The finance and interest charges are accrued based upon the outstanding principal, which means that the faster you’ll reduce the principal, the faster you’ll lower your interest charges. Your objective here would be to reduce the principal in order to lower the base for your finance charges.

If you cannot complete the first step, you could send the loan payments earlier than the due date. For example, if you must pay until 15th of the month and you choose to pay on the 1st, you will not have to pay the 14 days of accrued interest which means that a little bit more of your payment will go to the principal.

If you cannot make the payments earlier, try to make them on time. Not only you will improve your credit score but you will also avoid paying for penalties due to late payments. If you do indeed miss paying one, you will be assessed a late payment charge. Needless to say that if you miss payments your credit score will suffer.

It is recommended to get a copy of your FICO score as it is the same with your credit score. The higher this score is, the lower your interest rate will be. During the period of the loan, if you notice that the credit score has increased, you could refinance the outstanding balance.

Here are the most relevant factors that determine your car loan interest rate:

a)      Lender – unless you choose to borrow money from a private source, you are going to work with a bank, a credit union or one of the automaker’s financing arm. Each scenario has its own pros and cons;

b)      Car – it depends on what car you are buying. If it is new or if it is used. Most likely, a new car will have lower rates;

c)       Length of the loan – basically, the longer the term, the higher the interest rates. There are some companies that offer 0% financing on 5-year loans. However, even these offers have their downsides so be careful;

d)      Credit score – as mentioned before, your credit score will influence how much you will be paying for the interest. If it is good, you will be paying less.

It would be best to use your home equity to lower the interest rate of a car loan. Both a home equity loan and a home equity line of credit (HELOC) can often provide lower rates in comparison to traditional car loans thanks to the fact that these are secured against the value of your home. Of the two aforementioned choices, the second one will most likely offer you the lowest initial rate. The downside is that due to the fact that the rate is variable, you are vulnerable to the possibility of increased payments if the rates rise. For this reason, this type of loan is suitable for car loans of 36 months or less.

As mentioned before, even 0% financing deals can get messy. Let’s take for example that you want to purchase a vehicle that costs $16,000 and can pay zero interest for three years through the car dealer or get a $2,000 rebate. Your monthly payment for this car would be $444, 44. If you decide to take the rebate and finance through a bank at 5%, you will have to pay less per month – $419, 59. So, you will save $24, 85 per month which means that over the three-year period of the contract, you’ll end up saving $894, 60.

For getting a lower car loan interest rate you might want to check out independent financing. Dealer financing is in the vast majority of the situations more expensive in comparison than car loans obtained through banks, depending upon your credit situation. There are many cases in which the dealer of the car doesn’t make any money from selling you the car, but they get their profit from financing.

There are many car dealers out there that will try to get you to tell them how much money you can afford to pay every month, leaving room for them to raise your interest rate up to the monthly payment level you told them. After that, they have the possibility to sell this loan to a lending company and get a commission based upon the difference between what you are paying in interest and what the bank charges. This can turn out to be very costly for you. To give you a relevant example, for a 48-month / $20,000 car loan, the difference between a 7% interest rate and a 9% one is about $900 over the loan’s term.

As you can see, choosing the most suitable financing option for a car can be a little bit tricky. For this reason, it would be best to do a little bit of research before choosing one. Better safe than sorry.