Searching for the best auto loan rates requires taking inventory of your own personal finances and deciding on a financial institution that has what you’re looking for.
This can seem like an especially tall task if you’ve never searched for an auto loan before.
Before you dive into the process of finding your ideal car loan, check out a few tips below so that you can go into the loan process feeling confident and informed.
Know Your Credit History
Before you start shopping for an auto loan, be sure that you know your credit score.
To find your credit score, you can receive a free credit report from each of the three main credit bureaus yearly, so you should take advantage of that if you haven’t already.
Knowing your credit score will give you a better understanding of what you should qualify for and a basic sense of what your loan will look like.
Once You Decide on a Budget, Stick To It
Before you shop for a car loan, do some calculating to figure out a monthly payment that works with your finances.
Once you’ve figured that out, stick by that figure.
Some lenders may try to talk you into a lower monthly payment because that will ultimately make your interest payments higher in the long-term.
That’s good for them, but bad for you.
Know what you’re comfortable paying going in and don’t budge. Otherwise, you’ll end up paying more in interest and will be stuck with the car longer than you might want.
Try to Do All Your Loan Applications In Two Weeks
You should only be applying for car loans for a two-week window, because multiple loan applications leads to multiple credit inquiries.
Each inquiry results in a slight decrease in your credit score, which can make getting the best loan rate difficult.
However, if you make all applications during a 14-day period, credit bureaus will recognize that you are loan shopping and will only count the multiple inquiries as one inquiry, doing less damage to your credit.
Take Advantage of Credit Unions
Credit unions, on average, offer car loan rates 1-2% lower than banks do.
While that might not seem like much at first glance, that 1-2% over the life of a loan, can save you hundreds or even thousands of dollars.
HRCCU offers a range of different auto loan options based on vehicle age and loan duration.
If you don’t qualify for a conventional loan, we offer GREENLight loans.
To calculate the GREENLight loan rate for the vehicle that you’re looking for, or to help you find a vehicle that fits your budget, use our CarBuilder program online calculator.
No matter your credit situation, we offer fair loan rates with a focus on helping you build and maintain healthy finances, without creating financial stress.