If you are lucky enough to be looking for a new car then make sure that before signing up for the new car and the new car finance you check out the price competitiveness and the options available for a new car loan.
While most buyers believe they are in the box seat when negotiating the purchase price of a new car and the terms of a new car loan the reality is that more often than not a better deal can be had if you step back and check out your options thoroughly. Purchasing a new car is an emotional experience and unfortunately all too many people set their sights on a new car, are not too concerned about the new car finance, thinking that a new car loan from one source will be much the same as the terms of a new car loan from another source.
Let's consider the new car price. If you are negotiating with a dealer you obviously hope that you will do better than the marked price on the car. This may be so, but you are not negotiating from a position of power because you do not have any inside knowledge about the dealership and its sales volume. Why is this a factor when purchasing a new car? Most if not all dealerships operate on a bonus system whereby significant large bonuses kick in from the car manufacturer once a target monthly sales figure is reached. You may well get a better sale price on that new car if you purchase towards the end of the month when the dealership knows that your car sale will be critical in its achieving its targeted sales volume. Experience also demonstrates that if you negotiate your new car finance through a broker you may also be able to negotiate a better price on the new car. A good lease or mortgage broker (mortgage brokers almost always operate in the new car loan space as well) will have connections with the motor trade through which they may well be able to secure a better price on your new car and also provide you with as good or better terms on your new car finance. I recently purchased a new car and saved myself $2000 on the best price I could negotiate with a dealer by using a mortgage broker who also had access to competitively priced new car finance.
I won on both counts. I obtained a new car loan that was at a better rate than the new car finance offered by the dealer. What I found interesting is that with many new car loans the actual interest rate is not disclosed. The monthly repayment amount on the new car loan is but this can be manipulated to suit your means. The monthly repayment amount depends on the term of the new car loan and the residual value on the new car loan as well. Financiers invariably work on what you can afford and then tailor the repayments on any new car loan accordingly. This may make sense but want you may not realize is that the interest rate applicable on the new car finance may not be competitive.
Every dollar that goes out of your pocket is important - don't put yourself in a position where you pay more for your new car than you need to or find that your monthly repayment on your new car loan means that you are paying say $40 per month more than you might have, had you checked alternative funding sources for your new car finance.
Mark Bona is the managing director of My Choice Finance, the company is a mortgage broker offering new car finance and new car loans.
Source: http://ezinearticles.com/?expert=Mark_Bona
Before you start car shopping, first figure out what you can afford for a car payment. Look at your budget, research auto loans, and investigate lenders. Once armed with this information, you can choose a car that you can both enjoy and afford.Expense Of A Car
According to the FCIC, a car payment should be less than 20% of your after living expenses budget. While this is a good number to start with, you will want to look at your own budget numbers. Be sure to include other miscellaneous car costs, including fuel, insurance, and licensing fees.
You will also want to plan on a down payment and enough cash for the initial license, registration, and sales tax.
Terms Of Auto Loans
Auto loans vary with their terms rather than financing options. With a down payment of at least 10%, you can expect to find reasonable rates. While you can find auto loans with zero down, rates will be much higher. In fact if you can put down more than 10%, you will save more money in interest charges than if you get a lower rate.
Another way to pay less for your auto loan is to opt for a shorter term. You can get a seven year loan, but you are adding hundreds of dollars for those lower monthly payments. However, base your decision on what you can afford with your budget.
Auto Loan Lenders
Auto loans aren’t simply limited to your dealership or local bank. You can find hundreds of online financing companies who can offer you a great deal. Take a couple of hours to request quotes. Compare the rates and terms to select the best deal.
Even if you have poor credit, still check with conventional lenders. More and more are offering sub-prime lending. You may be surprised at the low rates offered to those with damaged credit.
You can also opt to be pre-approved, which will give additional leverage when negotiating your car deal. The application process is handled online, and you walk into the dealership with a blank check. The loan is finished when you fill in the amount and sign final paperwork.
To view our list of recommended auto loan companies online, visit this page: Recommended Auto Fincnce Companies Online.
Carrie Reeder is the owner of ABC Loan Guide, an informational website about various types of loans.
Source: http://ezinearticles.com/?expert=Carrie_Reeder
A new car loan from the dealer is not always the best choice for your new car finance
Posted by Michael Ronald at 12:39 AM
When purchasing a new car it is always very easy to be swept away in the excitement of it all and want to take delivery as quickly as possible. To do this it is simply a matter of agreeing on the price of your new car and signing the necessary documents for a new car loan. All done and dusted. But just how much more have you paid for your new car and your new car loan because of your “want it now” approach? Probably more than you think. Car dealers can be very persuasive and once they feel you are sold on a car then there is little hope of a reduced price or a very competitively priced new car loan. Here are a few tips when you are looking for a new car:
• Don’t go to the dealership with the expectation or desire to buy “today”. Check out the internet first to see just what the price range is for the vehicle you are looking for.
• Speak to a mortgage broker or a lease broker to see what connections they may have with new car dealerships. Surprisingly, a mortgage broker can not only access good new car finance but also has negotiating “clout” with a number of new car dealerships. Most new car dealerships have monthly volume targets which when reached result in large bonuses being paid by the new car manufacturer. As a direct purchaser you will not be privy to this information but where the mortgage broker has built a good relationship with a new car dealership he or she will undoubtedly be able to negotiate a better new car price for you – unless of course there is a waiting list for the particular car you are after. Even in this situation you may find that you will be able to achieve a better price – a
• If you are not absolutely set on a particular new car then find out what the re-sale value is of similar model cars when sold say 3 years later or at the expiration of your new car lease and new car loan. It is generally accepted that most new cars diminish in value by up to 15 % the moment you drive it out of the car yard. To ensure you retain value in your new car and that the residual value after 3 or 5 years under your new car loan will be met from the sale proceeds as a “used” car, it is imperative to check the sales history of the car / model/ manufacturer. It can be disheartening to find that when you eventually sell the car you do not realise a price that allows you to pay out the residual under the new car finance.
• If your cash flow allows it, try and keep the residual to as low a figure as possible. This negates the likelihood of there being a shortfall between the used car sale price and the residual value under your new car loan. If you maintain your car well and have it serviced on a regular basis then there remains the possibility that when you come to sell you actually realise more than the residual value under the new car loan – this should be a non-taxable profit in your hands.
Mark Bona is the managing director of My Choice Finance, the company is a mortgage broker offering new car finance and new car loan.
Source:http://www.justarticles.net/articledetail.php?artid=75338&catid=122
Buying a new car is no longer a dream but is a reality now for most of the aspirants. This is thanks to loan products like new car loans which are given for owning a new model car of any make at easier conditions including lower interest rate. New car loans are provided for buying any new model car of any make. Since new cars are priced very high, huge money is at stake in the loan. Hence lenders prefer to secure the loan. Often lenders prefer to take in possession deal papers of the new car for securing the loan. The deal papers are returned back to the car owner when the loan is fully paid back. Any property of the borrower can also serve the purpose of securing the loan. A secured new car loan gives necessary amount at lower interest rate for a low cost financing of car. This enables in lessening the debt burden as larger repayment duration of the loan helps in spreading the monthly installments over many years and results in lower monthly installments. While choosing repayment duration and also while deciding over the amount to be borrowed, keep your repayment capacity in mind so that you do not incur debts.
Do not hesitate if you are labeled as bad credit as new car loans providers will not look much into it. This is because you have secured the loan for the lender either through any of your property or through the new car you intend to buy. Some of the lenders may harden terms-conditions a bit but no one will deny a loan just because of bad credit.
Compare different new car loans providers by requesting for their loan quotes. Each lender has own set of interest rates. Comparing the loan packages enables in understanding every cost involved in the loan deal. You can find out how much competent the car loan deal is. Prefer applying online for the loan for a fast approval. Online application requires you to fill basic information like loan amount, car model, repayment period and personal details. After verifying the details the lender will approve the loan as early as possible.
New car loans are designed especially for easy buying of new car. The loan is given at lower interest rate to the aspirants. Make the best use of the loan also in improving your credit score by regularly paying monthly installments.
Ashley Lewis has been associated with NewUsedCarLoans. Having completed her Masters in Finance from Cranfield School of Management. She provide useful advice through her articles that have been found very useful.To find more about new car loans, used car loans, car loan financing, bad credit used car loans,fast car loans visit http://www.new-used-car-loans.co.uk
Source: http://www.articlealley.com/article_105419_19.html
