Purchasing a car can be a very exciting prospect and even be a symbol of success for some. There are so many ways to drive away from a dealership or seller with the car of your dreams, such as car finance or buying outright, but today, we will be talking about car loans. There are many banks and providers who offer car loans, but in this blog post, we will share three tips on how to find the best deals for your needs.
What Are The Benefits Of A Car Loan?
Before we share our top tips, here are a few reasons why you may want to consider this option:
- You do not exhaust all your finances in one go
- You repay in parts – usually, you will pay the down payment, then pay monthly instalments to the value of the car with interest
- Your credit rating may be boosted if you are able to keep up the repayments
- You can gain quick access to drive your chosen car
However, it is key to remember that a car loan may not suit every budget or all circumstances, so make sure you truly weigh up your options before committing to one avenue.
- Comparison Is Key
If you have decided that a car loan is the best way to go for your requirements, the first place you should start is with comparisons. You should not apply with the first provider you find. Instead, you should take the time to research and find the best deals and interest ratesto meet your circumstances.
You could research both online with direct lenders and offline with various banks to understand what kind of offers are available for you. A lower interest rate on your car loan can enable you to avoid paying more, so make sure you check for the lowest percentage available to you. You can also use digital comparison calculators, which will do all of the hard work for you.
- Think About Timing
Car dealers usually have a quota to meet, so you may be able to find some of the best deals during off-peak seasons. For example, many people may choose to purchase a new car in the summer for a holiday, so the prices may be higher. Aim to browse for deals during off-peak times towards the end of the sales quarter, such as April or November. You may also find special seasonal discounts or deals, but as always, make sure you compare across dealers and lenders to ensure you are receiving the best offer possible.
- Maintain A Healthy Credit Score
Of course, the best deals are usually offered to those with a good credit score, so it is always a good idea to try and maintain your rating. You can check your rating for free through Equifax, Experian or TransUnion, and a score over 750 is typically viewed as healthy. A lender or bank will conduct a background check to ensure your creditworthiness, so if they can see you have a good financial history, you may be more likely to receive the best offers. If you find that you have poor credit, there are still options available to your through specialist lenders. There area few ways to improve your credit, such as registering on the electoral roll, paying off existing debt, and keeping your credit utilisation as low as possible.
If you need any further help with your car loans, please seek impartial support from the Money Advice Service.