How to Get a Low-Interest Rate on a Used Vehicle Loan
How to Get a Low-Interest Rate on a Used Vehicle Loan
Posted on December 18, 2019
When getting a loan for your car, there are few things that you will want to consider first. One of the most important things to consider is how high an interest rate the lender is going to charge you. The higher the rate, the higher your monthly payment will be. There are a few things that you can do to ensure that you are getting a good interest rate when buying a car. Keep reading to find out how you can get a low-interest rate on a used car loan.
What Do You Need to Get a Vehicle Loan?
If you are looking for a loan on a used vehicle, you will need to bring a few things with you to the dealership. First, you will need to show your driver's license. Next, you will need to show proof of residency and proof of income. Once the finance team has your information, they will be able to process your application. If your application is accepted, there are a few other things that the finance team will look at in order to determine what type of interest rate that they will charge you.
What is Your Credit Score?
Your credit score will be one of the major factors that finance teams use to determine how much interest you will be charged. Having a bad credit score does not mean that your application will not be accepted, but it can make you have a higher interest rate. The reason for this is because if your credit score is low, then it means that you have a history of not making payments in the past. Because of your payment history, many creditors may label you a "highrisk." When a creditor comes across a high-risk customer, they tend to charge them a little bit more interest in order to offset the risk that they are taking.
If you have made your payments b time in the past, the creditor may see you as a low-risk customer. Because the creditor feels more confident that you will be able to make your payments on time, they will charge you a lower interest rate.
How Down Payments Can Affect Your Interest Rate
Making a down payment on your used car has many advantages. The more money you put down, the less money that you are borrowing. Because the amount that you are borrowing is lower, your interest rates will also be lower. Also, making a down payment will also reduce the total amount of money that you owe, so that means that you will also have lower monthly payments and could potentially pay your car off a lot sooner.
If you are looking for a used car loan with low-interest rates in Lethbridge, then contact our finance department today. We have a full team of knowledgeable finance experts that understand that bad credit is something that can happen to anybody. Whether you have no credit, good credit, or bad credit, our experienced staff ill help you get the best interest rates for your used car loan.