You’ve decided to acquire another vehicle–great! Before rushing off to the dealership, you’ll need to consider how much you can afford in monthly payments. Deciding this point will determine whether you look for used or new auto financing.

Once you know about how much you can afford in monthly payments, it’s time to think about what type of loan you want from auto loan finance companies. Options for financing a car include loans for autos, new vehicles, used vehicles purchased through a dealer, private party vehicles, auto refinance, and auto lease buyouts.

Keep these points in mind when choosing an auto finance company specializing in vehicle loans:

1. Do I want to buy from a car dealer or from a private seller?

2. Do I want to purchase outright or lease the vehicle? Auto Lease buyout loans are commonly required at the end of the lease period if you choose to keep the car.

3. Will I be paying off my loan on-time or early? Some loans carry stiff prepayment penalties. Not all but just be aware.  Most reputable auto finance companies tell you up front if there are fees involved.  For most, the process is free and with no obligation.

Action Steps
The best contacts and resources to help you get it done

Learn about Auto Financing
Study the different types of auto financing solutions.  Each one will have pros and cons, depending on your situation. Get familiar with how a lease works, read the fine print and precautions about financing an auto directly through a dealer, and get tips on how to fix less-than-perfect credit.  There are a lot of places that this information is available but here is our recommendation after years and years of auto lending experience looking out for the customer.

We recommend:  Read and understand the sections of our Auto Buying Guide that provide you a quick guide to the steps involved in buying and financing a car.  It’s down to earth and easy to understand.

Get automotive financing even if your credit isn’t so great
If you have had credit problems in the past, does that mean you’re reduced to driving whatever you can afford to pay for with cash? Not necessarily.  Some companies making car loans specialize in customers with bad credit.  We work with many of those companies so that we have done the legwork and that will save you tons of time.   Many vehicle financing companies have partnerships with car dealers prepared to offer bad credit car loan programs on car and truck loans.  You may be able to pre-qualify for a bad credit auto loan regardless of past credit challenges.   We never know until you apply and there is no cost or obligation to find out, even if you decide to purchase.

Have one company do the legwork of finding car credit
The Internet has revolutionized how we do a lot of things, including how we look for auto loans. Look for websites that are secure, first of all.  Next, verify that you are under no obligation if you enter your information on a website. Bottom line, use the ease of the Internet to make auto financing fast, easy, secure, and hassle-free.  You know you are at the right place, right?  That’s exactly what we do and 7 years and millions of customers stand behind us.

We recommend:  (I wonder who that might be, LOL) myAutoloan.com  – They can put an end to applying at several sites on the Internet and driving all over town trying to get the best deal on your auto loan.

Tips & Tactics
Helpful advice for making the most of our Auto Buying Guide

Be extremely careful with your personal & business information while doing research on financing a car.  Make sure you are dealing with a reputable company with a good track record to prevent possible theft of your identifiable information.  BBB information can be a real time saver too.

Research, research, research.  Get quotes on automobile financing from several providers by using a finance company that will show you up to 4 loan offers and not run you around testing you with a one at a time approach.   myAutoloan.com does!
Be wary of automotive financing car dealers claiming to specialize in financing bad credit loans.  Make sure the vehicle is actually worth the stated price. Some less than honest dealers artificially inflate a vehicle’s price, generously reduce that inflated price, and finance the balance at high interest rates.

How it works – The auto refinancing process is similar to the mortgage refinance process, but it does not have the costs and fees normally associated with the mortgage process. Basically, you obtain a new car loan at a lower rate to replace your first loan.  Ten years ago, auto refinancing was pretty rare.  They were available but just not much was known about them.  Now that interest rates have dropped dramatically and we continue to sit in this recession, auto refinancing has become increasingly popular. If you decide that you want an auto refinance loan, consider letting myAutoloan.com assist you in the process.  It’s fast, easy and there are no fees or costs to see if you can lower your payments or reduce the APR% on your auto loan. Apply for a no obligation, no fee auto refinance quote online to see how current rates might save you some money.

How much can you save – Refinancing can save you a lot of money, if you play your cards right. For example, if you currently have an auto loan for $23,000 at 11% APR for 5 years, you’ll pay $500 a month. If you can refinance this loan payment to $400 a month, you can save $6,000 over the life of the loan! The higher your current loan rates are, the more you can save by refinancing. Many of our lenders offer auto refinancing rates around  4.75% -6% APR.  Of course, it always depends on your current credit rating at the bureaus.

Who should refinance – Any individual who have an expensive auto loan or who wants to reduce their monthly payments, or lower their rates should consider auto refinancing.  Consumers with expensive loans from a car dealer can save big by refinancing with a lower rate from myAutoloan.  If your credit scores have improved significantly since your original car purchase, you should be able to reduce your rates which will save you money in the long run.

What are the requirements – Not all auto loans will qualify for refinancing. Since most lenders require you to have at least $7,500 due on your current loan in order to refinance, you might want to recheck and take a look at your balance.  There are also common restrictions on the age of the car and the car’s mileage.  Generally that means that if you have less than 70,000 miles and the car is less than 6 years old, you should have no problem getting an offer.  Plus, you may need to have a credit score say 525+ or so to qualify for a competitive refinance rate.

What are the dangers – While auto refinancing can help you save a lot of money in some situations, it may not always be a good decision. If you are thinking about refinancing, be sure to evaluate if it is really going to help you out because of payment reductions or APR % decreases.  Just don’t kid yourself before you really take a good look and make sure that it’s a smart thing to do.  By that I mean just be aware that a refinance loan may extend the term of your car loan in order to reduce your monthly payments. This could result in increased costs over the life of your loan.  So again, I’m just trying to make sure you are thinking this through so that it’s to your advantage, based upon your circumstances.  For most people, it’s a no brainer – if you can save some cash, just do it!

Refinancing allows borrowers more flexibility and freedom with their auto loans and with the cash that they save. People with expensive auto loans are no longer stuck with them for the life of the loan. Use them wisely and it’s clearly to your advantage! Find out today if an auto refinancing loan can help you save money and let us help you see just how easy it can be.  We would love to show you what we can do.

Refinancing your car loan is an ideal way to lower your overall interest cost or reduce your monthly payments.  If you get lucky, you can do both.  By using an online multi-lender auto loan finance company, you can be assured that you are finding the lowest rate.  To be sure you are getting the best offer; follow these three tips before you refinance your vehicle.

1. Know Your Goal

Before you refinance your auto loan, decide what your goal is. Do you want a reduced interest payment or have a smaller monthly payment? With your goal in mind, you can choose terms that will best meet your needs. To find reduced interest payments, it is best to have improved your credit rating. One easy way to do this it to pay your credit cards down to 50% of their limit. You can also find lower interest rates by choosing a loan shorter than the typical five year period. Regardless of what you are looking for, it does not hurt your credit score to look and apply for an auto refinance loan.

Remember, smart people shop and the credit bureaus score it as only 1 inquiry, within a two week period.  To reduce your monthly payments, look for a loan for a longer period.  You don’t even have to find lower interest rates to lower your monthly payment. However, you will be paying more in interest payments over the course of your loan.  Just review your options and make a good choice for you, and know what you want to accomplish on the short term.

2. Go Online But be Prepared

To speed through the refinance process, gather all your financial information, for the auto you want to refinance, such as lender, monthly payments amounts, estimated payoff amount and current rate.  It’s not critical that you have the VIN number or exact APR’s or amounts, but if that info is handy, have it ready and with you as you apply.

If you don’t know the current balance on your loan, you can call your current lender to get the exact amount.  Having a copy of your last tax forms will also make filling out the forms for quotes or a loan application easy.

3. Compare Quotes – Get your Refinance Auto Loan

When you are ready to find an auto loan, compare quotes before you pick a lender. You can get quotes from online lenders from our site – all you need to do is apply.  What we do is match your application up with our lender base and electronically post lender approval information on our site.  It is secure and completely private so that you are the only one that can see the information.  Getting multiple offers is important to you so that you can have a choice and pick the offer that is best for you. Your Loan – Your Way.

Not a bad approach, right?  You don’t want to get locked into a deal that you can’t pay early.  While rates and terms are important to compare, you also be aware that there are no fees for applying or using us for your auto loan. Select the rate that works for you and take it from there.

After a small amount of paperwork, you can have your new lender pay off the old one and you are on your way to saving some money.  Good luck and let us know if you have questions.

If it’s high, Now is a Good Time to Borrow

In this crazy lending market, interest rates have remained at historic lows but all the banks have gotten so picky that most requests for loans go unanswered.  There is an old saying that goes, “If you don’t need the money, you can borrow all you want”.

Well, a year after the global freeze in the credit markets that caused massive government intervention (aka interference) interest rates continue to remain at historic lows.

That’s great for people with good credit.  If not, it seems like you could be wasting your time.  Credit has gotten to be so tight that if you are willing to be interrogated for several days, and can document your entire life story, (video and pictures help) along with signed letters from every institution that you have done business with, you might be considered for a loan.  And from all we can see, it’s going to be around for a while.

Bank and financial institutions are on the defensive posturing stage.  After many completely blew lending on the mortgage side, it has had a ripple effect in all other areas of lending from home purchase, to auto, to personal loans, and any other mode of credit issuance that was common in the past.  Not now.  No segment of borrowers has been spared. During the housing boom five years ago, 7 of 10 applications were approved.  Today is 5 in 10.  With credit card companies getting tighter with credit, consumer credit carddebt declined by $6.1 billion in July.

For perspective, big banks are not risk averse.  That’s common sense, right?  Rather, their reluctance to lend has to reflect the fact that they must conserve cash to absorb billions in losses that are still expected to occur from bad loans that were made before our financial meltdown last September of 08. FDIC-insured banks lost a total of $3.7 billion in the second quarter, dragged down by growing number of bad loans.  They set aside nearly $67 billion in the second quarter in anticipation of future losses from all those wonderful decisions that they made for years leading up to the crash.

Oh, there are a lot of other reasons, such as the lack of ability to pool loans into securities, (ABS = auto back securities) for sale to investors, or securitization. Lehman brothers collapse pretty much dried up this market outlet but there are signs of opportunity that crop up from time to time.  With consumers ratcheting back their borrowing and banks getting tougher with their lending criteria, rates will remain low for those who have good credit.  If you can stand the pain, you will benefit from the gain.

What has been your experience?  We would love to hear what you are seeing from your point of view.

Here’s to getting this economy back on track.

I’m really not trying to be judgmental but as they say, you do the math.  Let me summarize.

Point 1
A vehicle getting 15 mpg and averages 12,000 miles per year uses 800 gallons a year of gasoline.  A vehicle getting 25 mpg and averages 12,000 miles per year uses 480 gallons a year.  So, the average Clunker transaction will reduce US gasoline consumption by 320 gallons per year

Point 2
Cash for Clunkers DOT officials reported 690,000 vehicles sold during the program – so that’s 220.8 million gallons per year.

That equates to saving close to 5 million barrels of oil per year. I repeat—per YEAR.  5 million barrels of oil is about ¼ (25%) of one day’s US consumption.  And, 5 million barrels of oil costs about $350 million dollars at $70/bbl.

Point 3
Our Government “gave” each Clunker Trader approximately $4,500 per car for 690,000 transactions which cost US Taxpayers $2,877,000,000–not including Washington’s astounding Administrative costs.

President Obama said in his speech to auto workers in Ohio recently, “One of the other efforts we undertook was the Cash for Clunkers program. Folks said that wouldn’t work either. That program was good for automakers, it was good for consumers, and, by the way, it was good for our environment.”   What I did not read in that speech was that it was good for taxpayers, and here’s why.

We all invested and paid (through our taxes) more than $3 billion+ $150,000,000 to administer, to save $350 million.

And the return on investment is….Priceless

Getting a new car loan? Now is the time to also check on insurance rates for your new car. Get a very competitive quote for car insurance available, as you do your research for auto financing, at BestCarInsurance.com.

myAutoloan.com’s used car loan rate for cars purchased at a franchise dealer is currently being advertised at 6.74 percent for car loans up to 36 months and the auto loan rate is 6.94 percent for loans between 37 months and 60 months.

Used car loans for purchasing an auto from a private party loan is a lot higher than purchasing from a franchised dealer. The current rate of loans up to 36 months is 7.19 percent and 7.79 percent for auto loans between 37 months and 60 months.

Rates for doing an auto refinance are at 4.75 percent for auto loans up to 36 months and 5.64 percent for car loans between 37 months and 60 months.  Leased buyout loans, buying your leased auto and financing the purchase, are at 8.08 percent for car loans up to 36 months and 8.45 percent for car loans between 37 months and 60 months.

See all the rates available by going to myAutoloan.com’s home page – rate chart is there.

In the second quarter, 0.80 percent of car loans were 60 to 89 days past due, up from 0.66 percent during the same period in 2008.  Thirty-day delinquencies rose 14.6 percent in the second quarter to 3.06 percent, up from 2.67 percent the previous year.   Combined, 30- and 60-day delinquencies amount to $25.5 billion in loans at risk. 

Why is this significant?  That’s because it prompts lenders to tighten their lending criteria.  The result is that it pushes many consumers out of the market altogether.  Sure some buy used but many just drop the purchase to wait out the strict requirements being applied.
 
Michigan was among only three states to show a reduction in 30-day delinquencies, according to the study’s findings. The other two were Alaska and Nebraska.
 
At some point the lending markets has to turn so that pent-up demand eases.  However, for right now, it’s a tough market and consumers are not getting much of a break on the cost of financing, that is unless you’ve got a high credit score.  In the meantime, we all wait. 

For the balance of the year SAAR (Seasonally Adjusted Annual Rate) figures will probably close the year out at just under 10 million per month annualized.  Next year by February, we should see things starting to break free.  Let’s hope that prediction holds!

So what are some of the discrepancies? Edmunds pointed out what it sees as inconsistencies with the government’s Clunkers statistics. One of the reasons the company delved into these figures is because it says there was an unprecedented wide range in analysts’ sales forecasts, with analysts’ forecasts for the month annualized sales rate at an unprecedented 4 million range. Stands to reason that someone would want to true up the numbers, right?

One of the “mysteries,” as the company calls it, is that the government release said the program took 690,114 clunkers off the road. However, apparently Edmund’s experts tracking the program found that clunker trade-ins never accounted for more than 33.4% of weekly sales. “It is mathematically impossible for there to have been nearly 700,000 new-car sales during the course of the program, given the actual sales numbers announced by automakers who should have no motive to under-report,” said Zhenwei Zhou, Edmunds.com senior statistician.

But now that the numbers are in some of the numbers do not add up.  Apparently, one of the difficulties in forecasting the sales number was due to the midstream change in the Clunkes program, or the fact that the program’s administrators changed the rules allowing dealers to take clunker trades on vehicles that were in transit or on order. “As a result, we’re still seeing clunker deals trickle in and are yet to be counted as sales,” noted David Tompkins, Edmunds.com senior analyst. “We expect that to continue for a few weeks. We expect about 50,000 vehicles will be delivered and counted as clunker sales in September’s sales reports.”

Michelle Krebs, Edmond’s senior analyst noted that the Department of Transportation reported on Aug. 26 that it had received 690,114 Cash for Clunker voucher applications for either $3,500 or $4,500.  As of Sept. 2, she said DOT had not changed that figure.  However, the governments own data doesn’t add up. In its Aug. 26 press release giving the supposed final tally for the program, the DOT gives the total application voucher as well as a breakout of the number of vehicles purchased by category and the number of vehicles traded in by category.

None of these numbers are the same. The overall application number of 690,114 is different from the number of clunkers the government said were turned in under the program — 685,201 — which, in turn, is different form the number of vehicles purchased — 684,941. While the differences are not huge or enough to impact forecasting, they should match. Presumably, the number of clunkers turned in and the number of vehicles purchased should be identical, which should add up to the number of applications.

So why does the clunkers number matter? From an economic standpoint, how many of the clunker trades resulted in sales that wouldn’t have occurred otherwise? Or did it merely pull from behind and pull from future naturally occurring sales. If it did produce incrementally higher sales, what was the cost per vehicle to shareholders? Even more important, sorting Cash for Clunkers data is important for forecasting going forward. Analysts, including those at Edmunds.com, auto companies and other forecasting firms, are trying to determine, what is the true underlying demand for vehicles by retail customers, excluding the clunkers program, and what is the trajectory of vehicles going forward.

What do you think are the government’s data  Credible or not?  How can you believe in anything we are being told?  Too many questions and not any answers.  Tell us what you think.

“American consumers and workers were the clear winners thanks to Cash for Clunkers program,” said Ray LaHood, U.S. transportation secretary. “Manufacturing plants have added shifts and recalled workers. Moribund (or bare) showrooms were brought back to life and consumers bought fuel-efficient cars that will save them money and improve the environment.”

Overall, rebate applications worth $2.877 billion were submitted by the Tuesday deadline. This covered 690,114 applications.
 
Top 10 Most Purchased Autos
Of the top 10 most purchased vehicles under the Cash for Clunkers program, only five automakers made the cut. This includes Toyota, Honda, Ford, Hyundai and Nissan. Toyota and Honda each had three models make the most purchased list, while Ford was close behind with two. Nissan and Hyundai meanwhile each had one model making the most popular Cash for Clunkers purchases.

Top Most Traded In Autos
The Ford Explorer 4WD and the Ford F-150 Pickup 2WD were the significant leaders in what was traded in.  Of the vehicles traded-in, 84 percent were trucks with 59 percent of customers purchasing passenger cars. The average trade-in mileage was 15.8 mpg, which leads to an overall increase of 9.2 mpg, or 58 percent climb, as the average new vehicle purchased receives 24.9 mpg.
 
Offering preliminary insight into the impact of the Clunkers program will have on the economy, the White House Council of Economic Advisers predicted the program will ramp up economic growth in the third quarter by about 0.3 to 0.4 percent at an annual rate due to the sales. The gross domestic product will be sustained thanks to increased vehicle production and to fulfill inventory requirements, the group indicated. Furthermore, an excepted 42,000 jobs will be created or saved.

New-Vehicle Manufacturer Percentages:
Toyota: 19.4 percent
General Motors: 17.6 percent
Ford: 14.4 percent
Honda: 13 percent
Nissan: 8.7 percent
Hyundai: 7.2 percent
Chrysler: 6.6 percent

There is, as we’ve mentioned many times, a large gap in opinions of just how successful the program was.  However, what it did do is create an artificial spike in consumer spending.  If you think about it, the conclusion that was most promoted by the non-objective major newscasters who thought of this as a good idea, was to proclaim its success. 

With the direct lending markets still in mourning from the failed practices of many banks mortgage fiasco, a huge market still exists for auto loans and refinancing for everyone who does not have a 720+ FICO score.  In the meantime, and still a “nightmare” is the fact that dealerships are still waiting for their money, and most have stopped junking the trade-ins in fear of Uncle Sam failing to reimburse them under the program.  Time will tell.  What do you think?  Good or bad, let us know.

It sill looks like consumers benefited, and the Government benefited by the “look what we’ve done to spark the economy” sound bits spewed all over the media, and finally, the dealerships got rid of a lot of autos sitting on their lots.

The problem is that they seem to be the ones floating the Federal Government, while they try to figure out how to make the payment processing work. That’s funny! From what I’m seeing, most dealerships are going on a wish and a prayer about getting paid.

I’m talking some major cash per dealership that is hung up in government regulations of 150 pages and some 14 different forms that need to be completed. Does that sound like efficiency to you? I think it’s totally blind faith at this point that the dealerships are going to get the money that is owed to them. Citi call centers have been awarded outsourced work, and the National Transportation and Highway and FAA employees have been brought in to process paperwork, in addition to part-time employees having been hired.

It kinda sounds like a cluster — I mean ‘Clunker’ to me. They are all working on trying to input stuff and they can’t get in because there is soooo much of it and the documentation to process just one sale with a qualified rebate takes hours to complete. The computers are overwhelmed. It’s a great program for the manufacturers, a great program for the consumers. For dealers, it’s been an administrative nightmare.

Think about this for a minute – The Obama administration and its allies in Congress propose to overhaul (and potentially run) health care for more than 300 million Americans?

I think we can say cash-for-clunkers doesn’t inspire much confidence in Washington’s bureaucratic acumen. Or its speed! Or its feel for a functioning market, the demands and expectations – - OK I’ll stop.

Will the dealers get paid? Yes, because failure to do so would be a PR disaster of epic proportions for the democrats and the administration. Will the program prove to be the jumpstart languishing auto sales need? Debatable, but probably not, though depleted inventories already are forcing increased production schedules across the industry. Those announcements were made about a week ago.

The more important question, it seems to me, is what the obvious administrative failures of cash for clunkers say about the federal government’s capability to manage programs more typically run by the private sector. And, secondly, why is there a clamor for more of the same? What is it about this poorly run program that the American people or even congress wants more of? Tell me, what am I missing? Why did the public not see or hear about the issues in the media? Clearly journalism has seen better days and major networks appear to be agencies for the Obama administration.

Sad day for the USA.

Auto dealers are in business to make money selling cars and trucks, not to serve as conduits for federal transfer payments. If nothing else, cash for clunkers proved Americans still love good deals — and that their government cannot process them.