Buying a new car is exciting, but it is also one of the largest purchases you will ever make. The most economical way to buy a car is to pay for it outright, but not many people have that sort of cash on hand. If you decide to finance your vehicle, you should consider several factors before diving in.
Know Your Credit Score
Knowing your credit score will give you an indication of how likely you are to be approved for a loan. A high credit rating means you will almost certainly be offered a loan. However, you can still get a loan with a low score, but you will likely get a high-interest rate. If the rate is too high, you might be better off waiting until you have built up or repaired your credit score.
Reduce the Loan Amount
To reduce the total amount of financing you need, put down as much money as you can afford. Pay cash for additional fees — including the dealership, registration, and documentation charges — sales tax, and any extra options you choose to buy.
Keep the Loan Term Short
The shorter the loan term, the better. You will pay higher monthly fees but you will get a lower interest rate, which can save you a lot of money on your purchase. A long-term loan can leave you owing more than the car is worth.
Rochester Toyota provides you with handy tools like a quick pre-approval form and a payment calculator for estimating your buying power and monthly payments.
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