Prudent Money Management
Smart Money Management Resources
Stephen Lau
Stephen Lau
Smart Auto Loan Financing
by Stephen Lau
If you need a car, you may also need a car loan - whether you buy or lease it.
Preliminary steps to obtain auto loan financing
ˇ Look for the desired vehicle.
ˇ Know exactly how much you can afford and are willing to pay for the vehicle, including registration fee, insurance, and tax.
ˇ Determine the value of the car you may be trading in.
ˇ Estimate the highest possible monthly payment you can afford.
ˇ Research to get a reputable dealership with the best price.
ˇ Be familiar with the terms of the invoice:
Base Price: the cost of the vehicle without added options
Invoice Price: the cost of the vehicle to the dealer (the
actual cost is much less due to allowances,
discounts, incentives, and rebates)
Sticker Price: the asking price of the vehicle.
Tips on the best strategies for car loan financing
ˇ Negotiate the BEST PURCHASE PRICE, not the monthly payment.
ˇ Pre-determine the EXACT PRICE you will be paying.
ˇ Negotiate the BEST VALUE of your trade-in (if applicable).
ˇ Negotiate the BEST FINANCING available.
Car loan financing is determined by the annual percentage rate (APR), which is contingent on your credit score (always check your credit score first), and the length of the loan, which may be 36 months, 48 months, 60 months, or 72 months.
A bad credit score may require a sizable down payment for auto loan financing.
Pre-determine the exact amount you will be financing.
Use online auto finance calculator to do the calculations.
A better financing option may be home equity loan, home equity line of credit, or mortgage refinancing. Always check your financing options first.
Points to remember about car loans
ˇ Negotiating car loan financing for leasing is the same as for buying. Go to the Federal Reserve Board website to find out the pros and cons of leasing as opposed to buying a car.
ˇ The monthly payment amount is always NEGOTIABLE.
ˇ Negotiate the purchase price and the auto loan financing SEPARATELY to get the best financing.
ˇ Do not be persuaded into accepting a deal based on monthly payments offered by the dealership (the financing deal offered for car loans always carries a higher interest rate).
ˇ The longer the loan, the more you will have to pay. To save, always opt for a shorter loan period, if affordable.
ˇ You are expected to negotiate your auto loan financing.
ˇ Always read the fine print of the contract before signing any auto loan financing.
CopyrightŠ by Stephen Lau
Return from Auto Loan Financing to the Home Page.
by Stephen Lau
If you need a car, you may also need a car loan - whether you buy or lease it.
Preliminary steps to obtain auto loan financing
ˇ Look for the desired vehicle.
ˇ Know exactly how much you can afford and are willing to pay for the vehicle, including registration fee, insurance, and tax.
ˇ Determine the value of the car you may be trading in.
ˇ Estimate the highest possible monthly payment you can afford.
ˇ Research to get a reputable dealership with the best price.
ˇ Be familiar with the terms of the invoice:
Base Price: the cost of the vehicle without added options
Invoice Price: the cost of the vehicle to the dealer (the
actual cost is much less due to allowances,
discounts, incentives, and rebates)
Sticker Price: the asking price of the vehicle.
Tips on the best strategies for car loan financing
ˇ Negotiate the BEST PURCHASE PRICE, not the monthly payment.
ˇ Pre-determine the EXACT PRICE you will be paying.
ˇ Negotiate the BEST VALUE of your trade-in (if applicable).
ˇ Negotiate the BEST FINANCING available.
Car loan financing is determined by the annual percentage rate (APR), which is contingent on your credit score (always check your credit score first), and the length of the loan, which may be 36 months, 48 months, 60 months, or 72 months.
A bad credit score may require a sizable down payment for auto loan financing.
Pre-determine the exact amount you will be financing.
Use online auto finance calculator to do the calculations.
A better financing option may be home equity loan, home equity line of credit, or mortgage refinancing. Always check your financing options first.
Points to remember about car loans
ˇ Negotiating car loan financing for leasing is the same as for buying. Go to the Federal Reserve Board website to find out the pros and cons of leasing as opposed to buying a car.
ˇ The monthly payment amount is always NEGOTIABLE.
ˇ Negotiate the purchase price and the auto loan financing SEPARATELY to get the best financing.
ˇ Do not be persuaded into accepting a deal based on monthly payments offered by the dealership (the financing deal offered for car loans always carries a higher interest rate).
ˇ The longer the loan, the more you will have to pay. To save, always opt for a shorter loan period, if affordable.
ˇ You are expected to negotiate your auto loan financing.
ˇ Always read the fine print of the contract before signing any auto loan financing.
CopyrightŠ by Stephen Lau
Return from Auto Loan Financing to the Home Page.
Credit Repair Made Easy
Repair your credit before you buy your car to get the best financing.
Click here.
Repair your credit before you buy your car to get the best financing.
Click here.
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