Buying a new a car involves a myriad of factors, each of which can affect how high or how low your car loan rates are going to be. If you’re looking to apply for a car loan, then you should know that car loan rates offered to you by different lenders may vary not just a little, but a lot. Understanding your own credit history is one factor that can definitely affect your car loan rates. Another is your knowing how credit-related information is interpreted by lenders. Both these valuable pieces of information play a big role in helping you get the best deal possible and the lowest car loan rates you can find.With that in mind, here are a few tips you can adapt so you can get the most favorable car loan rate available.
Your credit report affects your car loan rates.
Before you apply for a loan, it’s important that you obtain a copy of your credit report. Remember that when applying for a loan, the first thing that lenders are going to check is your credit history and what they find there could very much affect the car loan rates they’re going to offer you. Make sure that the information contained in your credit report is accurate and current. If you find any errors, you can contact the credit bureau and have them corrected.
Your credit score affects your car loan rates.
In car loans, credit scores have almost as much bearing on your car loan rates as your credit report. If credit reports outline all your past credits, credit scores show what exactly your standing is as far as credit is concerned. You can get your credit scores online from the three credit bureaus, Trans Union, Experian, and Equifax. For a small fee, the knowledge you get from accessing your credit score could save you a lot of money in car loan rates and interest charges.
To get the best car loan rates, target prime lenders.
It’s common knowledge that prime lenders offer lower car loan rates compared to other grantors so it’s best if you try to obtain your loan from them. However, it can always be assumed that different lenders charge different car loan rates. Sometimes, your rates may be lower even if you’re in the subprime category simply because you’re a member of that credit union.
To the best car loan rates, investigate the tiers.
In loan applications, there’s nothing like a good amount of research to get the best deals. Speak with your bank’s loan offices and ask them about their credit tiers. These are usually rated as A, A-, et cetera. You can get copies of these on paper and the information they contain can prove valuable when shopping for the lowest car loan rates and the best deals.