Most people have to put a lot of time and thought into buying a new car to be certain they are making the right decision. It is also incredibly common to take out a loan on the new car so you can pay for it slowly as opposed to in one lump sum. However, getting the car loan can be as crucial as negotiating at the dealership when it comes to saving money. To make sure you get the best deal on your loan, here are some common mistakes to avoid.
Not Knowing Your Credit Score
It is common to think that your credit score is lower than it truly is. If you don’t know what it is, the salesperson will have the upper hand. This is crucial, as even a small difference in your credit score can affect the interest rate on your loan, which can mean hundreds of dollars throughout the loan’s life. The best way to avoid this issue is to not only know your credit score before heading to the dealership but also take the time to apply for a loan at a credit union or bank. At the least, this will give you an idea of the type of loan you will be approved for.
Adding Everything to the Loan
It is very convenient to include add-ons or an extended warranty to your loan, but doing so will add to your interest. In most cases, you can afford to pay for these things without the help of a loan, so try to buy them separately from the car and pay them off right away. Otherwise, you may find yourself constantly paying interest on these add-ons.
When you are ready to get your new car loan, head to Brannon Honda in Birmingham, Alabama, and take a look at the wide selection of vehicles.
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