It is fairly easy to get an auto loan no matter your credit score. Of course, the better your score, the easier it is to get approved for the loan that you need and get the best terms possible. There are two main areas of concern when you apply for an auto loan: credit history and down payment.
The best place to start before applying for any loan is to get a copy of your credit report for free at www.annualcreditreport.com. Ideally, you should do this 2-6 months before you apply for an auto loan. The reasoning behind this is to correct any mistakes that may be on your report and to give you an idea of areas where you need to improve. You can boost your score by correcting simple mistakes and making sure that all positive accounts are being properly reported to the major credit reporting agencies. The higher your score is the better your chances of being approved at the lowest possible interest rates.
You can also maximize your chances of approval by having at least twenty percent of the purchase price as a down payment. You can save that down payment while you are correcting errors on your credit report. Try estimating how much you think you can afford as a monthly payment for your new car and the approximate amount that your insurance will increase. Put that amount into savings for six months. If you are able to put that money aside without withdrawing any of it during that six months, then you can afford that payment. If you have to dip into your savings, you probably cannot afford the payment the you have estimated and need to reevaluate your plan.
What Will Your APR Rate Be?
Interest rates vary from lender to lender, but the biggest factor is your credit score. In order to obtain your actual credit score, you will need to utilize a trusted service like this one, as annualcreditreport.com only provides your report, not your score. Once you have your score, you can utilize this rate calculator to gain a good idea of the interest rate that will be imposed on your loan.
As you can see, it is not that difficult to get a car loan – the real challenge is getting the car loan that fits you best. At Keystone Auto Loans, we guide you through the process. We have lenders and dealers across the nation who want your business. Let us place you with a lender who cares. Go here to submit your application!