Monday, November 24, 2008

10.5 Hints to Help You Get a Car Loan

By Geoff Cohen

AFI - This is a good article that I found on Ezine articles.com.


1.Know your credit score.

Get a copy of your credit report. Review it for errors and make any corrections before you try and get a loan. If there are major errors in your credit report, consider delaying your application until the corrections are completed. This will make sure you keep the car dealers honest. If you desperately need transportation, try renting a car short term until your credit report is straightened out. You may actually save money on fuel, insurance and repairs by renting which you can add to your down payment.

2.Have an explanation for your credit issues.

Dont be apologetic. Bad things happen to good people. Be specific about any problems or crisis that caused your problem. Let the bank know about any major upheaval in your life that may have led to your problems such as an illness or a natural disaster, like Katrina, or 9-11.Make sure that you can substantiate your claim.

3.Dont lie about anything on the credit app.

Lenders will turn reject your loan if they find you lied to them.

4.Know your income.

Make sure you can prove what you make. Have your proof readily available.

5.Save your down payment.

More down means more car. Larger down payments can sometimes get a lender to view your application more favorably.

6.Know what the payoff on your trade-in is.

If you are trading in a car with a payoff, get a ten day payoff from the lender. If you have a warranty or additional policies bought with the vehicle, find out if you can cancel them. This will lower your payoff or entitle you to a refund after the vehicle is paid off.

7.Know what your car is worth.

Check out NADA or KBB first. Go to CarMax and see what they will buy it for (provided they stay in business). Use these figures to negotiate the best trade in value. Remember, If you get more than the payoff, that amount becomes down payment.

8.Buy what you need, not what you want.

Set realistic expectations. Dont buy more payment than you can truly afford. Rebuild your credit first, than rebuild your image later.

9.Dont be argumentative.

Nice people get better deals than people who give sales reps a hard time. (Very true)!!!

10.Try other sources to get a loan.

Check online. Lenders such as Capital One, HSBC, Roadloans, and CitiFinancial all have websites which let you apply direct to them for a loan. You may get better rates and terms from lenders online than from a dealer.

Check your credit union or insurance co. They may have a loan program or lender relationship. A good payment history with your insurance company may help you get a loan from their bank. Credit unions can sometimes do automatic payroll deductions, which gives them re-assurance that you will pay the loan, so they might be more receptive.

(AFI's COMMENT - I do this myself, but remember, the f&i manager at least get's a loan origination fee to do the financing at the dealership. To respect the f&i manager, have your financing arranged, but allow them the opportunity to match the interest rate. It should make no difference which finance source you use, and it might make your delivery experience more pleasant as the f&i manager will know that he/she is at least making a little money on the deal. Believe me, there is nothing worse for an F&I Managers attitude sometimes, than having to deliver another "cash deal").


10.5 Dont go from dealer to dealer.

Excessive inquiries can be a reason a lender declines your application.


Geoff Cohen is a seasoned auto professional, with over 30 years experience. He has done it all, from sales rep to F&I Manager, New Car Manager, Used Vehicle Manager, up to GSM and GM. He has also worked as an area sales manager for a major sub-prime lender as well as run his own BHPH and Auto Leasing/Brokerage company.. He is the National Accounts Manager for AutoLending Network and is a contributing author to Subprimeconsulting.com, a blog about Special Finance solutions for auto dealers as well as F&I Magazine and World of Special Finance Magazine

Article Source: http://EzineArticles.com/?expert=GeoffCohen
http://EzineArticles.com/?10.5-Hints-to-Help-You-Get-a-Car-Loan&id=587796


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1 comment:

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