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Tue, Mar 29th - 9:55PM

Few Tips for First Time Car Buyers - Finding Best Car Loan Deal

Are you someone planning to buy your first car? Then you must probably be a high school student, a college student or have recently been employed. Buying a car for the first time can be a pretty exciting experience. Here are a few first time auto loan tips below to help you out.

>> Decide on which car to buy first. Be reasonable and choose one that you can make a 20% down payment on. If you can not do that, choose a different car. It is the best if you buy a car that you can pay off within 4 years.

>> Other than the loan payment, remember that you also have to pay for the gas, insurance, batteries and a lot other things.

>> There is nothing shameful in buying a used car. Buying a used Toyota Camry or Honda Accord is actually a pretty good idea since they will give you safety, dependability and freedom from costly repairs.

>> Do not expect to get a car loan financing for a car which is more than 5 years old. You will have to pay cash.

>> There is no return policy for cars. You can not give it back because you do not like it after 2 days. So decide well.

>> Most probably you do not have a credit history if you are a first time car buyer. This is one of the biggest hurdles you will face in getting a loan. You need to establish credit. You can get a gas card and credit card from your local department store pretty easily. When you use them, make sure you pay them off within a month. Do not dare overspend as it is going to reflect badly on your credit history. In fact, the balance should not reach more than 50% of your limit. Do this for 6 months. It will let you show some sort of a credit history to the lender.

>> Asking your parents, a relative or a close friend to cosign with you is a good idea if you do not have an established credit history. This means your cosigner will also be signing the loan papers along with you. It also means that your cosigner will be responsible for payments on your loan if you default. It is a matter of great risk and delicacy and you have to make sure that your cosigner knows what he is getting into before he signs.

The most important barriers you are going to face when you apply for an auto loan for your first car are:

>> Your lack of credit history will make it difficult to convince the auto loan lender

>> Finding financing for used car more than 5 years old is difficult, if not impossible

>> Insurance for your car will be pretty high

>> Dealing with car repairs and other maintenance costs will rake off quite a bit of your income

As a first time buyer, you should research well before you decide on finding an auto loan for your car. Happy car shopping!


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Tue, Mar 29th - 9:54PM

Low Rate Used Car Loan with Bad Credit - Is it Feasible?

It is not that difficult to get used car loan with bad credit. It is very much similar to get loans with good credits. Most lenders approve collateral loans in which the car owner has to owe a property or any other asset to the lenders. In case, if the monthly payments are not made promptly, the asset will be taken under the control of the lenders. The borrowers who are very sure with this procedure alone will agree for this kind of loan as they are aware of the seizure of assets. Financial institutions will find it difficult to allocate loans for people having bad credits and no asset. It is a tough decision to be taken.

The lenders will have to be very careful to safeguard their interests. They cannot give away finance for people those who do not meet any of the bank requirements. This will turn out to be a heavy loss for them. There is a way for people with bad credits and no assets to obtain auto financing in the name of unsecured loans. These loans are the best to offer as the banks can gain higher interest rates and reap more profits. The identity of the borrower must be conformed the records. The lenders will push the borrowers to sign the documents while financing a used car with bad credit.

Most bankers and lenders offer loans to people with bad credits. The loan interest rates are primarily based on the credit rates. The lenders should make sure that the borrowers have to apply the loan with a co-borrower. They are beneficial in many ways. The co-borrower should posses a good credit rating and they have to take up the responsibility if the borrower is not able to repay the monthly payments. If the borrowers can bring a co-signer or co-borrower, they are entitled to get low interest car loan.

The lenders should convince the borrowers to pay a good down payment. This will possibly reduce the risk of the loan amount as it will be meager when compared to the original market value. A good down payment may vary from 15 to 25% of the loan amount. Paying this amount also helps the consumers to pay lesser monthly installments and improve their credit rating gradually. This is a very good option to build up their fame starting from the scratch once again. The bankers must ensure that the auto loan amount does not exceed the existing market value.

The borrowers must ensure about their repayment capacity before applying the loan. Their dream car can be bought easily with the available loans. The repayment schedules must be met religiously. The lenders must be careful about the scammers. With the recession hit economy, it is actually a tough time for the lenders to get used car loans with bad credit. Genuine borrowers and lenders will always find the business very profitable and it is good to repay the monthly payments properly to avail all the benefits.


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