How to Find the Best Rates on Your Used Car Auto Loan

Finding the best rates on your used car auto loan can take a little time, however it will save you hundreds if not thousands of dollars over the life of the loan. It may even result in lower monthly payments. This article will show you how to get the best rates with little hassle on your nest used car loan.

Instructions

Difficulty: Moderately Easy

Things You’ll Need:

• Computer with internet connection
• Phone
• Pen and paper
• Make and model (VIN if available) of your trade-in
• Your Credit Report

How to Find the Best Rates on Your Used Car Auto Loan

1. Get a copy of your credit report and score. Also, have the VIN or make, model and year of the car you are going to trade (if any) and the VIN and make model and year of the car your want to buy.
2. Search online for used car auto loans and keep a record of the quotes and terms you receive. Write down the bank, the interest rate they quoted you, after giving them your information, and the term of the loan. Normally, terms are 60 or 72 months.
3. After you have compiled a list of rates its time to compare them. Select the financing rate that suits you best. Don't simply choose the lowest payment, consider the length of the loan, and the amount of interest you will end up paying over the course of the loan. Also, what else is the bank is offering you. Is there GAP insurance, can you miss a payment? Then consider the payment amount and interest rate.
4. If you aren't happy with these rates, it is time to talk to a few independent banks and credit unions. Call them direct or search for them online using the terms "credit unions", "local banks" or something similar.
5. Contact these banks directly and speak to someone who can discuss their rates and terms. Be sure you have at least the make and model of your car, as well as a copy of your credit report. Negotiate as best you can with the loan officer.
6. If you are still unhappy with your loan terms, dispute any outstanding items on your credit report, or better yet, pay them off. Then wait a month until those companies report again, and apply for your used car loan all over again. With a better credit score, you should get a better rate.

Tips & Warnings

• Banks will typically charge a higher rate on used cars, so if your rate is high, it might have to do with the age and condition of your vehicle. For a better car loan rate, you might be better off with a newer car. The price of your vehicle will also affect your terms and in some cases your loan rate. Be sure you aren't overpaying for a car, it could be the case if you can't find a loan.
• Used car loans can be expensive because the bank is loaning you money on a car that will only fall in value.
• Many used loan car companies will not grant loans to those with low credit scores, so be sure your credit score is in the 550 to 600 range if you expect to get a good rate.