The day has come for you to retire your old car and buy a new one. But you’re facing the prospect of being turned down for financing because your credit isn’t as good as it should be; nor do you have a lot of money to put down on a new car. It may surprise you to know that your credit rating isn’t as big of a factor as you might think, and you can find money to build a bigger down payment.
The Basics Of Auto Finance
When you go to a dealership to buy a car, and you don’t have the entire purchase cost, you finance the car for so many years. The longer you finance, the lower your payments, although you will pay more in interest according to Federal Trade Commission. A dealer typically offers multiple lenders, but you do have the option to identify the car you want and then get a loan before you go to the car lot to buy it.
Dealership financing is when you have the dealer find you a lender to loan you the money to cover the cost of the car. A dealership works with many lenders in order to offer customers financing, regardless of their credit rating. If you have bad credit, the loan can go one of two ways: the loan is made at a high interest rate or you won’t get a very large amount. Those with better credit ratings can expect to get approved for higher amounts with lower rates of interest.
Leasing is another way to get into a vehicle without having to put out a lot of money. The car is not yours to own, but it is yours to drive. As a leaseholder, you have to meet certain responsibilities to keep the car in excellent condition. Mileage is another issue to take into consideration as there is a maximum amount of mileage that can be put on the car every year. This can range from 10,000 to 15,000 miles. Going over the set amount can trigger a per-mile penalty. Make sure that leasing is the right option for you before entering into a contract.
Finding Money For A Down Payment
Once you’ve decided on what car you want, you will want to make a down payment. The more money you can put down, the better. It lowers how much you have to finance and can lower your payments because you put down money upfront. If you have limited savings, you’ll want to find ways to build up what you bring to the dealership. Your old car can bring you some extra cash when you sell it to a sell my car fast auto buyer.
That old piece of junk still has value in the form of metal and parts, and a car buyer is in the business of turning your old car into those parts. Handing over your title and car to a car buyer results in you getting a reasonable lump sum in cash that can be used to add to your down payment on your next car.