Many car buyers simply don’t realize the rates that they qualify for when getting a car loan. Some drivers with bad credit may feel that they are trapped, with no options. This can lead to mistakes in researching a car loan. For example, a new study by Capital One Auto Financing found that just one-third of first-time buyers actually checked their credit reports before applying for a loan. And almost half of those didn’t know what kind of interest rate they were getting.
Fortunately, there are many ways that drivers can lower their interest rate when working with a dealer. One way is to apply for car loans online. This way, drivers can compare the best rates. That said, multiple credit inquiries in a short amount of time can actually drive down a credit score. By simply calling and inquiring about rates, drivers can get the information they need. This is a great way for drivers to know what kind of rate they can expect from a dealer. Many dealers will slightly mark up a rate, but by having the knowledge of what types of interest a buyer qualifies for, consumers are in a better position to negotiate.
Finally, car buyers should always make sure they have their car loan in hand before signing any paperwork. There’s nothing worse than driving off the lot in a new car, only to find out the lender has not approved the loan.