When it comes to buying a new or used car, there are usually quite a few options regarding auto loans and interest rates. Many dealerships are offering low-interest loans that are quite a bit more attractive than what some banks and other traditional lending companies are offering. Unfortunately, most low income people will not qualify for them because they are being offered for excellent credit customers.
When it comes to auto loans for low income people, searching online is often viewed as the best option. As with all types of loans, you should be looking for the lowest interest rates as well as the best pay back terms available. However, you also need to consider if you want to put make a down payment on the vehicle. If possible, you should try and make at least a 20 per cent down payment, but this is often hard for those with a low income. The reason is so that the down payment of 20 percent will typically cover the depreciation of the car over the first year.
If you experience financial difficulties after buying a car, and you had no down payment, you are basically losing money on the value of the car if you tried to sell it for what it’s worth. When buying a car, you need to study what the initial cost is along with the long-range picture of making payments. Making them on time is so critical to improving and maintaining a good credit score.
It’s best not to go to the dealership first. Do your homework and shop online. Getting multiple auto finance offers is the best way to see what you qualify for so that you don’t over buy. Income limitations and the amount of debt that you carry are very important in determining what you can afford. Check out auto loan calculators on many sites to get an idea of what you can afford. Then check out the dealership. If you don’t qualify for an car loan from the car dealership, you may then have to check out local banks and other options in your city. When doing this, take into consideration the monthly payments and be sure you can afford them before agreeing to a loan. Many people end up getting into debt by purchasing a car that’s out of their price range. Don’t let this happen to you.
Auto loans for new and used cars can still be found with good interest rates when you look hard enough. Be sure to take the time to compare the offers that are on the table. Check out myAutoloan.com for an online, fast free loan comparison. When you shop around it could mean you may end up saving hundreds of dollars or even more each year.