Picking a car dealer loan out of the many car loan options open to you does not have to be a grueling affair. Like any auto loan lender, a car dealer wants to secure the highest rate of return on the loan they give, but it is in your best interest to equip yourself with several other quotes for financing and pre-approval elsewhere. In this way you will have a bargaining chip. Follow these steps to choosing a car dealer loan to get the best car loan terms possible:
Step 1: Budget and Credit Score
Plan your budget accordingly before you start shopping, and you won't be let down later if you find you can't afford the car you want. You should look to finance an amount whose monthly payment does not overextend your finances. Acquire a copy of your credit score too. Knowing this will give you a better idea of what type of interest rate you should get. If you are 680 or higher, you should get a prime interest rate and should question a high rate quote from a dealer, pointing out your credit score.
Step 2: Compare All Sources
At a credit union, bank or online you can find a car loan lender who will offer a competitive quote for car financing. Remember, dealers call their financing agents in order to offer you a quote. Cut out the middleman and get the quote yourself. You can use this information as leverage to get a better rate from the dealer.
Step 3: Negotiate
When you have quotes from elsewhere, your budget and your credit score, you can negotiate with dealers to not only obtain the most favorable interest rate possible, but a lower purchase price as well. Doing so will ensure fair treatment and money saved.