- Posted 21 Dec
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If you’re looking to buy a new car for the first time or looking to upgrade from your current one, there are some things you need to know when looking for the best deal on your car loan…
#1: Know your credit score
Before you start applying for car loans, make sure you know and understand your credit score. If you want to get the best car loan deal available, you’ll need to have a ‘clean slate’ ie, a good credit history.
If your score is low, you will still be able to secure finance, it just won’t be at the rate you want. Try and clear any outstanding bills you have and show your savings history; these will show that you can service a loan.
#2: Know your budget
Before you even start looking for a car loan, make sure you know how much you can afford to make in monthly repayments. You also need to factor in a buffer to allow for other expenses, such as insurance, maintenance and fuel. Factor this into your monthly budget to ensure you know what you’re in for.
#3: Limit applications
Don’t be tempted to apply for several car loans at once. This can impact your credit rating, as every time you apply for finance, this is recorded against your credit history. Do you due diligence up front, then apply for just one.
Research possible car loan options and then compare them to make sure you understand fully what the terms are for each loan. Once you’re ready, start enquiring over the phone to find out more details. Only apply once you’re happy with all the terms.
#4: Using credit cards
Depending on the amount you’re looking to borrow, a credit card might be your best option. If the loan you’re looking for is less than $5000, it might be better to get a credit card with an interest-free period and a low interest rate, than a personal loan.
#5: Consider consolidating
If you have multiple debts, consider combining them into one new loan that will save you money, as you’ll be able to access a lower rate and only have to worry about one monthly repayment. This option could be good for you if your credit score is not so great.
If you need help buying a car or finding the right car finance, let the team at Australian Credit and Finance assist you. We have over 20 years experience in the industry and can find you both the right car and the right finance. Call us today.