AUTO LOANS
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Chances are you can make a better deal for a new or used car if you shop like a
cash buyer with your
auto loan already in-hand. You could save hundreds if not thousands on the
total purchase price of your new car by negotiating a lower
cash price or by shaving a percentage
point or two from the dealer's car loan.
If your dream car is out of
reach right now, you may be able to save some real money by
refinancing your current car loan.. |
There's a rule of thumb formula for determining how much you can finance monthly for an auto loan. Take one-half your monthly net (take-home) income. Subtract from that the amount of your monthly rent or mortgage payment. The remainder is the maximum amount you could be able to finance for your car payment and car insurance payment combined.
HOW MUCH CAN YOU FINANCE - RULE OF THUMB
$3,000 take home pay divided by 2 = $1,500
$1,500 - $700 rent = $800 maximum for car and insurance.
If you pretty much know the year, make and model of the car you're looking to buy it makes sense to Get Quotes!
for car insurance so you will know how high you can go on the auto loan. Remember, the formula is the maximum for both car loan and car insurance payment added together.
Too Many Applications Will Hurt Your Credit Score
"Hard" credit inquiries can hurt your Credit Score. Some say as much as 5 points per inquiry. Your Credit Score does matter! Lenders make decisions about interest rates almost entirely on your Credit Score so even a few points damage to your Credit Score could mean hundreds of dollars over the life of a loan. Or maybe even a loan rejection!
Apply Here for an
auto loan direct from the lender.
Your credit score does matter. As a rule of thumb credit scores above 680
qualify for the best car loan rates. Below 680 is sub-prime and these borrowers
will pay substantially higher rates. Credit scores below 540 will likely not
qualify for any car loans.
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