The 7 Best Auto Loan Companies in America

New cars at sunlit dealer showroom close view.

It can be incredibly difficult to have the cash on you to purchase a new car when you need it. My poor car has seemingly been on its last leg for a while now. I think the only reason it is still kicking is that it is as stubborn as I am, and I happen to be grateful for that. At this moment, there is simply no way I can just pay for a car outright so I’ve been having auto loan companies on my mind.

For those with the same struggle, know that you are not alone. I know that does not really solve the problem, but it’s still nice to know. And, anyway, the fact that so many people need help purchasing a vehicle is the reason that there are so many auto loan companies available to help us out.

With so many options, it may seem impossible to choose the right one, but it’s not. We are going to talk about seven of the best auto loan companies in America so you can narrow down your choices.

7 of the Best Auto Loan Companies in America

There are many good lenders in this country, but here are seven great ones to start with:

1. 5K Funds

5K Funds has a network of more than 100 auto lenders and offers a very simple, fast, and secure online process. The initial application can take as little as 90 seconds. If approved, you get access to the funds pretty quickly.

Unfortunately, you might also have to repay the loan very quickly. Terms do go up to 72 months, but depending on your loan amount and other factors, you could have a repayment term of only two months. All of this is stated prior to accepting any loan offer, so you have the opportunity to turn down a loan with unfavorable terms.

5K Funds is one of the auto loan companies with relaxed qualifications. There is no specified minimum monthly or annual income. They are more concerned with you having a steady income. There is also no minimum credit score requirements. In fact, other than a steady income, their only stated requirements are that you are at least 18, be a U.S. citizen, and have a valid bank account.

Pros:

  • Very quick application and approval process
  • Quick access to fund after approval
  • The complete and secure online process
  • No fees

Cons:

  • Maximum loan of $35,000
  • Some short repayment terms

2. CarsDirect

CarsDirect is a great company that can help people from all financial walks, including those that have bankruptcies, bad credit, and even no credit. You can use these loans for both new and used cars as well as refinancing current auto loans.

CarsDirect is an auto finance broker that can link you to both financing and cars in one place. With a large network of thousands of lenders, they have the ability to help pretty much anyone who is at least 18, both reside in and is a citizen of the U.S., and makes at least $18,000 a year.

CarsDirect does not specify a minimum credit score. Instead, they work with all types of credit. However, the interest, length of repayment, and the need for a down payment will depend on your credit and income. CarsDirect can be excellent for those with poor or fair credit who need a car and want to build their credit.

Pros:

  • Find car and loan in one place
  • Accepts bad credit
  • Prequalification and fast application
  • No fees

Cons:

  • The potential need for a down payment
  • Broker- not a direct lender

3. Monevo

Monevo is one of the auto loan companies that is a broker as opposed to a direct lender. They have a network of more than 30 lenders and you can easily apply for and compare loans on their website. You can also prequalify so there is not a hard credit hit until you choose one of the auto loan companies to go further into the application process with.

There are very few set requirements: You must be 18 or older and a U.S. citizen or legal resident to apply. They also require that you have a valid bank account under your name. Any additional requirements would come through the individual auto loan companies in their network.

You can apply for loans up to $100,000 with terms all the way up to 12 years. The interest rates start very low at 3.49 percent but they can get high depending on your credit.

Pros:

  • Soft credit hit first
  • Works with all credit types
  • Repayment terms up to 12 years
  • Borrow up to $100,000

Cons:

  • Fairly new to the U.S.
  • Smaller network than some other auto loan companies

4. Auto Credit Express

Auto Credit Express is connected with more than 1,200 auto loan companies that work with good credit, bad credit, and bankruptcies- even open bankruptcies in some cases. They do require that you make at least $1,500 per month before taxes, are 18 or older, are a citizen or legal resident of either U.S. or Canada, and have a valid phone number.

The auto loan companies connected to Auto Credit Express offer a wide range of loan amounts, most of which fall between $1,000 and $35,000. Interest rates for those with good credit can be as low as 3.99 percent. Bad credit scores could lead you to pay up to 29.99 percent. Repayment terms vary widely among the auto loan companies in the network.

Along with lenders, Auto Credit Express also has a network of dealerships. You can only use their loans for those dealerships, so if there is a car outside of that network you want, you will need to apply elsewhere. Some credit types and loans do require a down payment, but they tend to be very reasonable.

Pros:

  • Great for all credit
  • Works with even open bankruptcies
  • The network of over 1,200 auto loan companies and auto dealerships

Cons:

  • Can only purchase through a partner dealership
  • Might require down payment

5. Capital One Auto Finance

Capital One is pretty well known for being open to those with less than perfect credit. Their auto loans are no different. Even those with a score as low as 500 have a chance of being approved if they meet the income and citizenship requirements. Interest starts very low at only 3.59 percent, but lower credit scores do move closer to 24.99 percent. Capital One auto loans typically range from $1,000 to $35,000, and you can get up to 84 months to repay the loan.

While Capital One does supply direct loans, you still cannot shop just anywhere for your car. It has to be purchased through one of their partner dealerships. Not to worry, though. They have more than 12,000 dealerships they work with, so you are bound to find the car you need and want.

They do have other rules about the vehicles, such as they cannot have been manufactured before 2009 and they must have less than 120,000 miles. Some vehicle types, such as Oldsmobiles, Suzukis, and Saabs, do not qualify either. Capital One offers auto loans all over the U.S. except for Hawaii and Alaska.

Pros:

  • Provides an auto search tool
  • 12,000 partner dealerships
  • Up to 84 months for repayment

Cons:

  • Not available in Hawaii or Alaska
  • Can only shop with their partners
  • Rules about the vehicles you choose

6. Lending Tree

Lending Tree is a popular organization with a large network of auto loan companies. With such a network, Lending Tree does not state any specific requirements because they vary so greatly. Both the minimum credit score and minimum income requirements depend on which of the auto loan companies you choose through them.

These variations can be positive for many people, but it can still be a bit frustrating, too. The standard requirements, though, are that you must have a valid bank account, a stable income, be 18 or older, and be a U.S. citizen or permanent resident.

Lending Tree is connected with auto lenders that offer loans up to $300,000, and you can get up to 72 months to repay the loan. Interest rates start as low as 2.99 percent and often top out around 4.44 percent, though your income and credit score may affect this amount. You can use the loan for new and used cars as well as refinancing and lease buyouts.

Pros:

  • New and used cars
  • Refinancing and lease buyout
  • Up to 72 months to repay
  • The large network of lenders
  • No minimum credit score

Cons:

  • Terms vary between lenders
  • Hard credit hit

7. Car.Loan.com

Car.Loan.com is another auto broker that can link you up with several auto loan companies. There are loans for good credit, bad credit, and no credit as well as a history of bankruptcy. There is no minimum credit score, but they do want you to have at least $1,500 per month. You are also required to have at least five personal references, three years of job history with 6 months at your current job, and a valid phone number.

Car.Loan.com has access to loans ranging from $1,000 up to $45,000. Interest rates start as low as 7.99 percent but- like all other auto loan companies- your interest will depend on your credit score. Repayment terms go all the way up to 84 months for qualifying loans. The only real downside is that the process is not completely online. An agent will contact you to finish up the application. This kind of takes away the convenience factor, but it is still a good option to consider.

Pros:

  • Up to 84 months to repay
  • Fast approval process
  • Works with all credit types
  • Low interest for good credit

Cons:

  • Some dealings with an agent
  • Interest can get high

Before You Apply

You really need to make a plan before you apply to any of these auto loan companies. Your plan will help you choose the best auto loan and lender for you.

Granted, that down payment may be a bit steep for some people with low income and little time to save, but you should still try to have a good down payment to minimize what you need to borrow. Here is a calculator to help you determine how much you can actually afford.

You should also determine how long you will need to pay off your debt. Most lenders offer repayment terms from a few months to several years. Experts suggest keeping it around 60 months, or five years.

However, you might need to keep it much lower than that. Are you expecting any major life changes or any negative impact on your income before those five years are up? Do you have a baby on the way or is one of your kiddos heading off to school? Will you be taking a year off to help take care of your aging mother or even taking some time off due to an operation you will be having? If the answer is yes, you might not want to commit to a five-year repayment plan.

The more you can decide beforehand, the easier it will be to narrow down your options. Also, if you have not yet picked out a car or dealer, don’t do it. Your best loan offer may come from a lender that requires you to purchase specific cars from specific places. It is okay to window shop and to get an idea of what you are looking for, but try not to settle yourself on any one single vehicle until you know the rules of engagement.

Conclusion

Paying out of pocket is most certainly not the only way to buy a vehicle. Even better, you do not have to have a perfect credit score, a perfect job, and a perfect down payment, either. There are auto loan companies out there who work with just about anyone, any income, and any credit. You just have to look for them.

We provided you seven awesome auto loan companies to check into, but by all means, look into as many as you need to in order to be comfortable with the company you choose. Shop around as much as you can, receive as many prequalifications as you can to more thoroughly compare your options, and take the time to think each of your options through carefully before making a final decision.

A Motorcycle Loan to Help Get You On the Open Road

Two Wheels, One Engine

If I weren’t doing what I’m doing today… I’d be traveling around the world on the back of a motorcycle. (Donna Karan, Fashion Designer and founder of DKNY Clothing)

As someone once observed, there are two kinds of people in the world – those who ride motorcycles, and those who wish they could.
I’m not sure that’s entirely true, but neither is it completely without merit. For those of you who love their hog, chopper, cheese-burner, bike, beast, bagger, or bar-hopper, there’s simply nothing like hitting the open road with your machine.

A motorcycle can be practical, of course. They’re generally more affordable than automobiles, and they use way less gas. As long as you’re not trying to bring home too many groceries or pick up a half-dozen kids from their activities, there’s a certain appeal to just strapping on that helmet and getting where you need to go.

Still, the practical stuff is almost secondary, isn’t it? That’s not why we ride – at least not mostly. It’s possible there are a few out there who choose their vehicle primarily to get from one point to another, but…

That’s weird, right?

Most motorcycle enthusiasts insist that there’s something about the ride itself that makes it unlike any other form of transportation. The closest comparison is probably the relationship cowboys used to have with a good horse. It’s a tool – it’s there to work for you, essentially – and yet, it’s almost a companion. An object of affection. Some would say a work of art.

That may be going a bit far, in my humble opinion, but then… it’s not my horse. Er… motorcycle.

Financing Motorcycles – A Beginner’s Guide

Driving a motorcycle is like flying. All your senses are alive. When I ride through Beverly Hills in the early morning, and all the sprinklers have turned off, the scents that wash over me are just heavenly. (Hugh Laurie, Actor)

The procedures and considerations for a motorcycle loan are in many ways similar to any other sort of vehicle finance. Be aware, however, that not all auto lenders do motorcycle loans, and dealer financing at a motorcycle dealer may be handled a little differently than at your local car lot.

Dealership Financing

Like auto dealers, name brand dealerships may sometimes offer amazing rates or zero-interest deals in order to move inventory or spark interest. If you’re looking at a motorcycle loan, see what the dealer can do.

Other times, however, dealerships use financing to cushion the low-profit margins of the internet age. It’s great that we’ve reduced all the haggling and secrecy and suffering of your father’s vehicle-buying experience, but dealers still have to make a few bucks to keep the doors open and all those colorful balloon-men inflated. That can mean pushing add-on packages you may not need or partnering with outside financial institutions to milk a little extra out of the small print.

They may want you to be happy with the bike, but that doesn’t mean they’re automatically your best source for a motorcycle loan. At the very least, do some loan shopping BEFORE you get serious about selecting a motorcycle, or even a dealer. Know your options so you can discern whether or not what they’re offering works best for YOU.

Banks / Credit Unions

There’s nothing wrong with checking out your local options for a motorcycle loan. Credit unions usually offer better terms than banks, but you must be a member to qualify. How difficult this is varies with the credit union. Some are very particular, and unless you work in a specific industry or meet their exact requirements, you’re out of luck.

Others will pretty much take any excuse to let you join. My local credit union targets educators, but if you’ve ever worked in a public or private school in any context, have kids in school, or have ever been to school yourself, you qualify. That means there are maybe a dozen people in the entire U.S. who couldn’t open a savings account with them. The only way to really know is to ask.

Online Lenders

You’ve probably already figured out that we’re partial to this option around here. Online options generally mean convenient logistics, competitive rates, and flexible lenders, for a motorcycle loan or anything else.

Many online lenders are happy to work with you if you have limited credit or less-than-perfect credit history. They’ll still look at your credit score, and if you’re applying for a motorcycle loan, they’ll pay particular attention to your track record with vehicle payments. A lower credit score means higher interest rates and sometimes additional upfront costs because you’re technically a higher risk for the loan.

But just because your credit rating matters, for better or worse, wherever you apply, that doesn’t mean all loans are the same or that all lenders will handle it the same way. Online lenders are nimble by design, and some specialize in higher risk loans and developing long-term relationships with customers who need to build their credit history just as much as they need to take home that two-wheeler. They’ll look at your job history, your debt-to-income ratio, and whatever else might make you an acceptable credit risk. In short, they’re looking for ways to say YES.

I’d tell you that this is where Loanry comes in, but I suspect you know this by now. Yes, we’re very good at connecting people with reputable lenders. No, we don’t charge you for any of it. We help you connect; you decide whether or not to move forward with whatever offers are made thereafter. Of course, we hope you end up with a great online motorcycle loan – but that’s mostly just because we like you.

You do not need a therapist if you own a motorcycle, any kind of motorcycle! (Dan Aykroyd, Actor and Comedian)

Types of Loans

Generally, you want to finance your purchase with a loan specifically designed for whatever you’re buying. There are, however, other sorts of credit which could conceivably be used in place of a traditional motorcycle loan.

Credit Cards

If you have a high enough credit limit or choose an affordable enough bike, you could simply charge your purchase on a credit card. It’s certainly convenient since you don’t have to qualify for anything new – you already have the card and an approved limit. This also avoids adding another bill to keep track of. Your required monthly payments will go up as you increase your balance, but it’s not a separate obligation you’ve added on – just more of something you’re already paying.

On the other hand, unless you have a particularly good interest rate on your current credit card, you’ll end up paying more in interest this way. Credit cards are also difficult to pay down if you make the minimum required monthly payment, while a traditional loan has a set term and the same payment required each month.

Line of Credit

A line of credit, sometimes called “revolving credit,” is in some ways similar to a credit card. You’re approved for a maximum amount, but only take out what you need as you need it. This means you’re only paying interest on money you’ve actually used.

A line of credit is generally more practical for ongoing expenses, such as those associated with a small business, but there’s nothing that says it can’t be used in place of a motorcycle loan. It is difficult to imagine the circumstances in which this is your best plan, however.

Family or Friends

The pros and cons of personal loans which are this, well… personal depend entirely on the individuals involved. You may get great terms from Uncle Gustav and the flexibility to skip a month here and there if he knows you’re in a rough patch. On the other hand, it might mean some very uncomfortable holiday dinners or unnecessary family drama.

Money and relationships don’t usually mix well. That doesn’t mean they never work out– but be honest with yourself. I want you to get that bike, but in the end, people are more important, right?

Um… right?

What Factors Influence My Motorcycle Loan?

We’ve already talked about the importance of your credit rating and credit history. Those aren’t the only factors in what sort of motorcycle loan you can reasonably expect. Here are a few of the most common…

Purchase Price

This one’s a bit obvious, but there’s more to it than you might immediately recognize. The difference between a $5,000 motorcycle and an $8,000 motorcycle isn’t $3,000 – it’s $3,000 plus the additional interest on the loan. If the higher price means you stretch the terms out for 6, 12, or 18 months longer than you would have otherwise, the total cost over the life of the loan will be even higher.

I’m not saying don’t get the machine you want; just realize that when you finance, it’s about more than the purchase price.

Down Payments and Interest Rates

Motorcycles, in general, aren’t as expensive as cars or trucks, but it’s easy to spend $10,000 or more on a decent bike. Let’s use round numbers and assume you buy one for exactly that amount. You’ve been saving up, and manage to pay $1,000 down, leaving $9,000 to finance.
You work out a motorcycle loan at 4.5% interest to be paid back over 36 months, making your payments around $267. Assuming you stick to the schedule, by the time the bike is paid off you’ll have paid $638 in interest. Fair enough.

Let’s finance that same amount at 4.9%. It doesn’t sound that much higher, does it? We’ll also assume you’ve decided not to use your savings as a down payment (I’m sure you’re doing something responsible with it and not blowing it on scratch-off tickets and overpriced coffee). If you stick with 36 months, interest over the life of the loan will cost you about $773. Your monthly payments will now be $299. This may not sound like a dramatic difference until you think about what $30/month can actually do.

Just one more. Hoping to keep your payments down, you stretch that same loan of $10,000 at 4.9 over 48 months instead of 36. It works, sort of – now your monthly payments are around $229. Over the life of the loan, however, you’ll end up paying over $1,023 in interest – a substantial difference for such a short time frame.

New vs. Used Motorcycles

Buying a used motorcycle can mean big savings on your motorcycle loan. Prices are typically much lower than new machines, so you’re financing less and hopefully setting up a shorter term for paying it off. Used motorcycles depreciate more slowly than new, so you’re less likely to find yourself “upside down” on your loan.

On the other hand, used motorcycle loans, like used auto loans, tend to carry a higher interest rate than when you buy new, making your monthly payments a bit higher and meaning you pay more in the long run for the money you borrow.

I really love to ride my motorcycle. When I just want to get away and be by myself and clear my head, that’s what I do. (Kyle Chandler, Actor)

Preparing for a Motorcycle Loan

Whether you’re applying at a local bank or credit union or exploring online options, there are a few things you can do to maximize your time and effort and make the process as painless and efficient as possible for yourself. It’s all about information and preparation.

Revisit Your Budget

Just because you can get approved for a certain motorcycle loan amount doesn’t mean you should spend your maximum. Hopefully, you already have a household budget to assist in making these sorts of decisions; if not, it’s time to put one together.

Obviously you want to purchase a bike you’ll be happy with. Keep in mind, however, that whatever loan arrangements you make won’t go away just because you’re roaring down the road feeling awesome. Let’s remember the less exciting but no less significant feeling that comes from being able to successfully cover your monthly expenses when you get home.

“Keep my motor running – head out on the highway. Looking for my checkbook and whatever I should pay… Like a true, mature adult, I was born, born to be pragmatic. Don’t want my debt so high that I can never afford to die… Born to be… solvent…” (No? I’ll try again.)

“Here I go again on my loan… paying down the only bike I’ve ever owed…” (Still not doing it for you? Maybe just one more.)

“All I wanted was to be free, and that’s the way it turned out to be. Flow credit, flow, let your waters wash down – keep me on this road to pay everything off in a timely and responsible manner…”

Clearly I’m in no danger of becoming the Weird Al of financial wisdom. Perhaps we should move on…

Check Your Credit Report

You don’t want to find out there’s an issue with your credit history or a problem with your credit score while you’re in the middle of applying for a motorcycle loan. It’s easy to check your credit ahead of time for free, so there’s really no excuse.

If you discover an error on your credit report, it may take a few days (or longer) to resolve it. Don’t wait until the last minute to do this part. In fact, it might not hurt to save your place and check your scores now.

Don’t worry, I’ll wait.

Comparison Shop

You may have a pretty good idea of what sort of motorcycle you want to get. That doesn’t mean you shouldn’t explore your options, however. Knowing what else is out there – features, costs, etc. – arms you with information. Besides, you never know when you’ll fall in love with something you didn’t even know existed.

The same is true of your motorcycle loan as well. Comparison shopping is essential to getting the best deal available to you. It’s not just about interest rates – it’s about terms, other charges or fees, and making sure you’re comfortable with your lender (you’re going to be dealing with them for a while). Arm yourself with information. Keep an ongoing list of questions you want to ask and important details you wish to compare.

A motorcycle is a long-term commitment; so is a motorcycle loan.

To Thine Own Self Be True

In the end, no one else can tell you what to buy or the best way to finance it. Every situation is different and you know yourself better than anyone else. But go in as informed as you can and as prepared as possible. I’m not trying to take the fun out of buying that bike; I’m trying to make sure it’s still fun a few months later when the “new” has worn off but your obligations remain.

See you on the road!

Auto Refinancing to Help Save More Money

Always focus on the front windshield and not the rearview mirror.

~~Colin Powell

When you think “refinancing,” there are probably two basic scenarios that come to mind. One is the possibility of refinancing your mortgage to lower your house payment or secure temporary cash to invest in home repair or improvements without adding to your monthly debt. The other is an overall debt consolidation of some sort – taking out one large personal loan to pay off credit cards and other debts in exchange for a single, lower monthly payment and hopefully a better interest rate and more manageable terms.

These are both completely valid refinancing scenarios and have proven useful to many people in many different situations. But they’re not the only time you might consider refinancing. Besides, you may have a great interest rate on your home and it would be counterproductive to rock that boat. You may have your monthly bills under control and don’t need to get too carried away with how you’re handling them.

But how are those car payments looking these days? Are you wishing you’d managed to negotiate a better price or lower interest rate? Regretting taking on that second or third payment before the first one was completely paid off? Maybe your financial situation has changed and you need to lower your monthly payments. Maybe your credit rating has improved and you qualify for a better interest rate or other terms now. Or maybe you took advantage of some sort of promotional dealer financing that looked great for the first few months and then the small print kicked in and it suddenly didn’t look so great anymore.

Auto refinancing is a valid option whatever your situation. It’s not for everyone in every situation, but it’s worth looking at long enough to decide whether or not it’s right for you right now.

The car has become an article of dress without which we feel uncertain, unclad, and incomplete in the urban compound.

~~Marshall McLuhan

How Do I Shop For Auto Refinancing?

Shopping for auto refinancing is not all that different from shopping auto lenders before you buy a vehicle to begin with. You’re going to look for lenders willing to listen to your needs, offer flexible terms and competitive auto loan rates, and make things convenient for you, the customer.

Just like when you borrowed the first time, your credit rating and credit history will be major factors in determining what sort of terms you can secure. Auto lenders will often more heavily weight your history with auto payments specifically when calculating your credit score. They’re less concerned with what you might owe the hospital or the apartment complex you lived in last year than whether or not you have a strong track record of making your car or truck payments.

The same is true for auto refinancing. Your overall credit rating matters, but your history of car or truck payments matters a little bit more.

Have you ever noticed that anybody driving slower than you is an idiot, and anyone going faster than you is a maniac?

~~George Carlin

Just like borrowing the first time, you’ll want to take some time before applying to calculate what you can reasonably afford. Although in most cases auto refinancing is intended to reduce monthly debt rather than take on more, extending the life of the loan might mean paying more in the long term. Or, there may be refinancing fees or other charges up front to consider, even if overall you’ll save by making the change.

Finally, gather your documentation ahead of time to simplify the process. All the usual items – proof of income and employment, any outstanding debts or assets, etc. You’ll also want records of the auto loan or loans you wish to refinance. What did each vehicle cost? What were the terms? How much have you paid? What’s the balance on each loan? Having this information prepared and ready helps keep things moving and might even help persuade the lender that you’re a bit more reliable than most.

You never know.

Americans will put up with anything provided it doesn’t block traffic.

~~Dan Rather

Why Consider Online Refinancing?

It’s probably no surprise to you that we’re pretty big fans of online lending and online auto refinancing. You may not know exactly why, however.

There’s certainly nothing wrong with talking to your local bank or credit union. If they offer you the best rates and favorable terms, that’s awesome – go for it. They sometimes run specials or go the extra mile to try to bring in new customers in hopes you’ll do the rest of your banking with them as well. Just like with any loan or other financial decision, check out all of your options before committing!

Let’s look at some of the reasons online auto loan shopping and refinancing might be the best option for you.

Flexibility with Auto Refinancing (or Anything Else)

Many online lenders are able to offer more flexible terms and often better interest rates because they were designed to be nimble. They may have low overhead, no nice brick buildings near the mall with fancy lobbies and public restrooms to maintain. A number of them specialize in specific types of loans or customers, meaning they don’t have to be all things to all people.

An online lender who deals primarily in auto financing or auto refinancing and who specializes in customers with limited credit or poor credit is able to focus all of their resources, training, knowledge, and creativity into that segment of the financial world. Of course they can do it more efficiently and flexibly – it’s literally the focus of what they do. It might be ALL they do.

Willing to Compete for Your Business

That also means they want your business. It’s not like there are other customers or other types of banking they’d rather be doing, but they have to be nice to you because you’re there. You’re the customer, and they know you can go anywhere you want – including banks, credit unions, or other online lenders. That means that online lenders are more likely to compete for your business. They want you to be happy now and down the road so that next time you need a loan, you’ll be more likely to start with them.

Isn’t that how healthy competition and capitalism is supposed to work? Making things better for the consumer? Sure, we should be realistic. Not all of us are going to qualify for the premium rates or the maximum amount. Sometimes we’ll have to accept certain fees or slightly higher interest in order to move forward.

But let’s not be so quick to act like everyone who makes us a loan is doing us a huge personal favor, or like we’re doing something wrong by asking for it. Loans come with interest and fees, which we’re going to pay. That’s how lenders make their money. We’re paying for the right to use that money and pay it back over time, but in years past, anyone with less-than-perfect credit or with a below-average income was expected to almost… grovel before a loan officer somewhere, as if we were seeking charity or forgiveness for a personal wrong.

I may be exaggerating a bit, but the point is that it’s about time lenders treated borrowers as equal players in the game, whatever our credit history. So yes, that’s something I particularly like about online lenders. They simply tend to be better at this part of things.

No offense to your brother-in-law at the credit union or anything. I’m sure he’s nice, too.

The Convenience of Online Auto Refinancing

Finally, it’s simply SO convenient to auto finance (or auto refinance) online. You don’t have to dress up or get to any particular office at any particular time. There’s no waiting in the lobby reading old magazines and no sitting across the desk from a guy in a suit who asks you way too many questions then types for a long time without telling you what’s happening. Online auto refinancing can be handled on your schedule, at your pace, and on your terms. Very often, the money is in your account within 24 hours.

Don’t confuse reputable online lenders with the sort of sketchy payday loan storefronts you pass next to the liquor store or any of those “quickie cash” signs flashing outside the gas station with the bars in the window. Of course the same sorts of iffy operations exist online – it’s the internet. That’s why we here at Loanry go to great lengths to maintain a curated database of legit lenders and what they do – so we can connect you to those most likely to meet your needs.

What you work out with them from there, of course, is entirely up to you.

The American really loves nothing but his automobile: not his wife, his child, his country, nor even his bank account first… but his motor-car. Because the automobile has become our national sex symbol. We cannot really enjoy anything unless we can go up an alley for it.

~~William Faulkner

Where Should I Start With Refinancing an Auto Loan?

Before contacting lenders, look at your current vehicle payment(s) as part of your overall budget. How much are you bringing in each month, and how much is going out? Just as importantly, where is it going? If you don’t have a fairly detailed household budget, you should make one. I’ve belabored this point elsewhere, so I won’t badger you about it too much right now, but let’s be honest – you really shouldn’t even be talking about auto refinancing or any other kind of major financial decision unless you have a pretty good handle on your exact fiscal situation now and for the foreseeable future.

Can you tell I’m giving you a very serious “I hope you’re taking me seriously about this part” look right now?

Next, take advantage of our auto loan calculator to see just how much you could save (or not) by refinancing. It’s often helpful to have a general idea of what sorts of numbers you’re talking, particularly when comparing interest rates or factoring in upfront charges.

Cars are the ultimate symbol of freedom, independence, and individualism. They offer the freedom to “go anywhere,” whenever it suits and with whom one chooses.

~~Sarah Redshaw

Other Considerations

Remember that while you’re probably not dealing with down payments or trade-ins when you’re looking at auto refinancing, there are still other factors besides interest rate which impact the total cost of the loan. Perhaps the most overlooked, despite being one of the biggest, is the length of the loan.

Stretching out the number of months over which you repay what you’ve borrowed certainly lowers your monthly payments. Over time, however, you’re paying much more in interest – not because the rate is higher, but because it’s being calculated over a longer length of time.

NPR recently did a piece on the growing popularity of seven-year car loans:

A seven-year car loan means lower monthly payments than a three- or five-year loan… A third of all new car loans now have terms longer than six years, according to the credit reporting company Experian. That’s more than three times as big a share of the loan market as a decade ago.

Hey, at least you’re not alone, right?

But while these loans are popular, they’re probably not the best personal finance move…  Longer-term loans usually have higher interest rates — and you’re paying longer…

And if you want to sell your existing car — maybe you have another child and need a minivan — with a seven-year loan you are much more likely to be stuck still owing a lot more than the car is worth.

Sometimes this sort of compromise is necessary in order to manage your many obligations. If so, that’s fine. Monthly payments matter, and it’s better to pay a little more over the long term than risk not being able to make your payments on time every month. Just be aware of the trade-off so the decision you’re making is an informed one.

On the other hand, the article goes on to explain that much of the time, the issue isn’t rising car prices. It’s that buyers want more car or truck than they could otherwise afford. In other words, many times, the issue isn’t need so much as greed.

You can know or not know how a car runs and still enjoy riding in a car.

~~David Byrne

Anything Else I Should Watch For when Refinancing?

Pay attention to any refinancing fees or other upfront charges. Make sure you know what sorts of charges are involved if you’re late on a payment (we never plan on being late, but it’s still best to know). Ask also about the lender’s policies regarding overpayment or early pay-offs. Some companies love it when you pay extra or pay back the loan early; others not so much.

Obviously, if you’re looking at auto refinancing, you probably already have one or more auto loans which you negotiated, or at least considered while someone else laid out the details, at some point in the past. You apparently signed the dotted lines, because you’re here now considering reworking them a bit.

That said, some of us manage to get pretty deep in the process without fully understanding all of the details (and not just when it comes to auto loans). If you’re considering refinancing but still have questions about how you got here in the first place, it’s probably not a bad idea to revisit a few auto loan basics before moving along any further.

Some debts are fun when you are acquiring them, but none are fun when you set about retiring them.

~~Ogden Nash

Once You’ve Refinanced

Now that you’ve rebooted your loan, there are a few pitfalls to avoid. I’m sure YOU won’t be tempted by any of them, but other folks sometimes are, so I feel obligated to cover them.

The first is that if your auto refinancing went well, your monthly payments have probably gone down. And before long, your credit rating may start to go up. That means you’ll soon have the option of spending more than you have been on other things. Or taking on more debt now that you’re not so buried as you were only a few short months ago. You may be offered some pretty sweet terms on new credit cards or some pretty special deals on another vehicle.

I hope you’ll allow me to be blunt.

Dude. Just don’t even. You’re doing so well – why go backwards now? That big-ticket item you want to charge and that new debt you want to take on are like tequila and Jello shots for a recovering alcoholic. They’re chocolate pecan pie and Double Stuff Oreos in the second week of your diet.

I’m not suggesting you deny yourself life’s essentials, or that you can never charge again. But keep thinking big picture. You want to be free of excessive debt. You want to have options when it really matters. And you want access to low-interest funds on reasonable terms when it’s time to pay for that wedding, those medical bills, that vacation, those repairs, that remodeling. Fiscal responsibility isn’t about making sure you stay miserable and deprived – it’s about being intentional and making sure that what you’re CHOOSING is actually moving you closer to what you actually WANT.

It’s not about my rules or what I’d buy. It’s about why you’re working so hard to begin with. And it’s about where you want to be in six months, and in two years, and at retirement.

If you think nobody cares if you’re alive, try missing a couple of car payments.

~~Earl Wilson

Fresh Starts and Timely Payments

The other thing to avoid is getting careless with your wonderful new refinancing loan. Whether you got a great auto refinancing deal thanks to your good credit or whether you had to accept a few fees and a slightly less impressive interest rate because you have poor credit, you are now going forward one way or the other. Your credit history and credit rating will get better or worse based on how you repay this loan (they rarely stay the same).

If you realize you’re going to be late, contact the lender before the due date. That doesn’t make it OK, but calling is always better than not calling. If you realize you can’t make the full payment, make part of a payment. That doesn’t make it “not late,” but paying some is almost always better than paying none.

Ideally, of course, you make the payments on time. Every time. Wherever you started, you’d be surprised how quickly your credit improves when you do this. That is, in fact, the whole idea.

Told my girl that I’ll have to forget her – rather buy me a new carburetor. So she made tracks saying, “This is the end, now.” Cars don’t talk back – they’re just four-wheeled friends now. I’m in love with my car.

~~Queen

Did You Know?

  • More Americans are borrowing money to purchase a vehicle than ever before. There were over 27 million new auto loans in 2018. And it looks like 2019 will top that by the time the year has wrapped up.
  • The average debt for that car or truck (new OR used) is going up as well. (Hence the seven and eight-year loans we mentioned above.)
  • Home mortgages account for the biggest chunk of personal debt, which isn’t particularly surprising. Over two-thirds of the money we owe is for our homes.
  • Student loans account for another 12%, making them a hot political topic all by themselves. Some major candidates are suggesting college and other post-secondary education should be free or far more affordable for anyone who wants it. (So far no one has suggested the same thing about cars or trucks.)
  • Auto loans come in a close third, just ahead of credit card debt. Nearly 10% of our total debt is for a car or truck of some sort.
  • Over the past decade, auto loans for borrowers with credit scores of 620 or less (generally considered “poor”) have risen, although the number has leveled out in the past year or two. The same is true of scores in the 620 – 659 range (“fair” credit) and those between 660 – 719 (“good” credit). Borrowers with a credit score between 720 – 759 (“excellent” credit), however, continue to grow as a percentage of total borrowing, as do those at the top of the credit history food chain with scores of 760 or above (“please have my babies” credit).
  • Despite the fact that so many people are behind on so many things, the average credit score in the U.S. is gradually increasing. (Isn’t America wonderful and strange at the same time?) In 2018, more than 21% of Americans were considered to have an exceptional FICO Score, an increase of 5.6 percentage points from the average in 2005.
  • The total amount owed by Americans on their personal vehicles is over $1 trillion at the moment, and the number of those getting behind on their payments is rising. Around 6.5% of vehicle loans are currently 90 days or more late.
  • The credit scores demanded by auto lenders and the interest rates they’re charging are going up. A higher credit score means better terms and a higher limit, but that in turn means more debt.

Conclusion

Auto refinancing isn’t the answer for everyone, but it’s worth looking at and something we don’t always consider. Our hope at Loanry is that whatever you decide about your car or truck payments, it will be part of your larger journey towards financial security and informed personal money management.

We’re happy to help you find the right loan and connect you to some great online lenders. Let’s not downplay the power of getting some of that auto debt under control. Or re-negotiating some of those terms and rates.

Even a successful refinancing isn’t always enough all by itself to turn today’s struggle into long-term, ongoing success. That’s why at Goalry we offer a range of financial blogs, online tools, and personal organizational services. We care about your debt, but we also care about helping you create and maintain a useful budget. And appropriately invest your wealth, and manage your personal or small business taxes, and…

Well, you get the idea.

There aren’t always easy answers. We certainly aren’t trying to do everything for you or even tell you what to do in all situations. We just have this crazy idea that life is complicated enough, and personal finance doesn’t have to be. It at least doesn’t have to be as hard as it sometimes seems.

Online Auto Loans Open Anywhere at Anytime

Here’s a recent headline from Forbes that kinda says it all:

Cars Are Costing More Than Ever To Purchase, Finance, And Own, Yet Consumers Remain Unfazed

On the one hand, here’s to capitalism and an American economy that allows you to purchase the vehicle you need (or at least want) through creative financing and good ol’ competitive lending. On the other…

Consumers are coping with rising prices and financing costs largely by extending their car-loan terms… Unfortunately, on average, for every 12 months a car loan is extended it will cost an owner nearly $1,000 in additional finance charges.

Ouch. And it doesn’t stop there.

Due to rising interest rates and other factors, the AAA says the average yearly cost of vehicle ownership has likewise risen to a record peak at $9,282, or $773.50 a month. Higher financing rates account for 40% of the rise in overall ownership expenses…

You get the idea. What does this mean for you as you consider your next vehicle?

I’m In Love With My Car

It’s not like most of us can simply do without. Sure, Americans in larger cities can get along quite contentedly with public transportation. And maybe a bicycle or Segway or something. For the rest of us, however, we pretty much have to have a car or truck. Otherwise, we can’t get to work, take the kids to soccer practice, and buy groceries. Just as important, our car is where we listen to our music or enjoy our podcasts. It’s where we think our own thoughts and process our day. It’s more than transportation – it’s a refuge.

So let’s assume you gotta have a vehicle. Statistics say they’re getting more expensive and people are paying more to finance them. How do you secure a car or truck that meets your logistical needs and maybe fulfills at least a few of your auto-related hopes and emotions, all without taking on unnecessary debt or getting yourself into credit trouble?

Let’s talk about logistics before you run out and start test-driving anything.

How Do Auto Loans Work?

It sounds like a silly question, but it’s something many people don’t adequately consider before they find themselves sitting in some salesperson’s office talking about whether or not they need to add on the upholstery protection package.

Where Can I Get A Loan?

Because of the cost of most automobiles, new or used, it’s traditional for buyers to finance vehicle purchases. This can be done in several different ways. Your local bank or credit union probably have published rates for automobile loans. You can even get pre-approved so that by the time you actually go car-shopping, you know how much you can afford to spend and approximately what sort of monthly payment you’d be committing to.

In the 21st century, there are numerous online auto lenders as well ready to compete for your business. Some even specialize in used car loans or auto loans for bad credit, for example. Auto loans online have the advantage of efficiency – you can usually go through the entire process without leaving your house, and approval times tend to be faster than with traditional lending institutions.

Interest rates for online auto loans are very competitive since many online lenders are designed to be efficient and operate in very competitive conditions. You won’t be sitting across a desk trying to persuade a guy in a suit that you’re worthy; online lenders will be working to earn your business and keep you happy. That’s how they succeed. We’ll talk more about how to find the most reputable and reliable online lenders in a moment.

How Does The Loan Work?

Traditional auto loans (including online auto loans) are term loans at fixed interest rates. That means that once you’re approved, you’ll be presented with a fixed number of monthly payments at an unchanging interest rate until the vehicle is paid in full. The advantage to this is that there are no surprises – your payments come due at the same time every month and stay the same throughout the life of the loan.

That doesn’t mean there are no variations. Or that it’s impossible to make adjustments if your circumstances change. But unless otherwise specified, auto loans are pretty straightforward.  Be aware, however, that any number of things can influence just how much that monthly payment might be. You may also encounter some very tempting alternative forms of financing. In such cases, it’s all about the details. You might save thousands, or spend thousands more in unexpected fees or additional interest. Always pay attention to the specifics, and don’t hesitate to ask questions!

How To Get An Auto Loan

On the one hand, as we discussed above, most auto loans are fairly straightforward in terms of how they’re structured. On the other, there are several considerations you should be aware of before you get too far in the car-buying process. So let’s see how can you get an auto loan.

The first – and it’s a big one – is the question of where you want to finance. There are three basic options: a local bank or credit union, one of the many online lenders available in the 21st century, or the dealership where you purchase your vehicle. For either of the first two, it’s usually wisest to talk about your options before you shop for a specific vehicle. Most local banks and credit unions, as well as lenders specializing in online auto loans, have procedures by which they can pre-approve you for a specific amount. That way, by the time you’re actually shopping, you know exactly how much you can afford and what you’ll be paying monthly if you decide to commit.

You’ll want to be prepared with documentation of things like your income over the past year, employment information, and other basics. While it may not be essential at this stage, you should at least be thinking about whether or not you’re likely to trade in your existing vehicle or make a substantial down payment on your new purchase. Finally, you should have a pretty good idea whether you’ll be focusing on new or used vehicles as you shop.

Online Auto Loans

Exploring your online options can be a bit daunting without guidance. We do many things here at Loanry, but one of the biggest is connecting borrowers with reputable online lenders. Don’t worry, we’re not going to charge you for anything, and we don’t loan money ourselves. Instead, we gather some basic information about who you are and what you’re looking for. We can help you get your own copy of your credit scores or even your full credit report absolutely free. Our online tools, such as our online loan calculator, can even help you play with the numbers ahead of time so you feel more confident going in.

There are several advantages to online auto loans. The most obvious is that the entire process takes place online. You can do it any time of day or night from wherever you happen to be. Who would have thought only a generation ago that you could receive multiple offers from lenders competing for your business while sitting in your underwear in the middle of the night eating Corn Nuts?

That’s not required or anything, but it does highlight the convenience of online auto loans. Those Corn Nuts probably aren’t doing your keyboard any favors, though.

If you have a decent credit history, online auto loans tend to offer very competitive interest rates and other terms. You may have the pre-approval or the money in your account as early as the next day

What Role Does My Credit Play When I Want an Online Auto Loan?

The short answer is “a big one.”

Your three-digit credit score and your credit history are major factors in whether or not lenders are willing to extend you the loan you’re seeking for the car or truck you want. Now for those of you who aren’t familiar with credit scores. There are two common forms of this magical number – the FICO and the VantageScore. While computed slightly differently, each results in a number between 300 – 850. This acts as a “snapshot” of your overall creditworthiness for lenders. Each one considers your payment history, your current debt or debt-to-credit ratio. And overall reliability when it comes to various forms of credit extended to you in the past.

Auto lenders, including those specializing in online auto loans, sometimes modify these numbers to give extra weight to your auto loan history specifically. After all, they’re primarily concerned with whether or not you’re likely to pay for the car or truck you’re trying to buy. Not your track record with your landlord, the credit card companies, or your past due medical bills. It’s not that those things don’t matter. But sometimes your payment history with the same sort of loan they’re considering extending to you matters more.

The advantage (and arguably the major limitation) of a three-digit credit score is that it’s straightforward and easy to compare to whatever internal charts or tables a lender might use to determine what sort of interest rate to offer you, or whether to offer you a loan at all. Some lenders, particularly those offering online auto loans, want to look a bit deeper. They’re looking for reasons to say yes, not reasons to turn you down. In that case, they’ll probably look at your full credit report.

Your credit report has a detailed history of every loan you’ve ever taken out and how you did repaying them. It will show your employment history, where you’ve lived, and all sorts of other details about you. If you had a rough patch several years ago, but have been regularly employed and paying your bills on time more recently, that will be easier to establish with a credit report than simply looking at a credit score. If you’d like to know more about the role of your credit in financing a vehicle, my colleague Julia Peoples elaborated about it recently in a piece well-worth checking out.

Online Auto Loans With Bad Credit

A rocky credit history will make any loan more difficult, but it doesn’t necessarily disqualify you from getting the car you want. Many online lenders specialize in loans for people with bad credit, or with very little credit history at all. Be aware you will probably be looking at a few fees upfront and possibly stiffer penalties for any late payments. Interest rates will be higher as well because the risk to the lender is greater. Make sure you’re OK with the terms and that you can realistically make your monthly payments for the life of the loan before committing, even if you really really really want this vehicle!

If you do choose to move forward with the loan, be aware that every payment you make – or don’t – impacts your credit rating and overall credit history. Online auto loans for bad credit can be an opportunity to not only drive away with the car or truck you’ve been wanting, but to rebuild your credit and establish a positive history with a lender you may wish to utilize again someday.

There are other options to consider if you have less-than-perfect credit. You can use these in conjunction with whatever loan you manage to negotiate or try one or all of them separately.

The first option is a co-signer. This would be someone with a strong credit history who trusts you enough to put their credit rating on the line to help you out. If you make your payments as scheduled, your credit record improves without any change to theirs. If you don’t, their credit record is damaged and they may eventually be expected to pay what you’ve promised. That makes this a big deal and not something to be taken lightly. Money matters, but so do relationships, yes?

The second option is to make a substantial down payment. There’s a difference between having a shaky credit history and being completely without resources. Saving money isn’t always easy, but even a few thousand dollars down can make a huge difference in your monthly payments, interest rates, and even the willingness of lenders to take a chance on you. This tends to be true of traditional lenders as well as online auto loans.

A third option is to challenge any inaccuracies on your credit report, or to spend six months or a year working on your credit rating before you apply for a loan. This can be tedious, but even a few minor errors on a credit report can impact how a potential lender views your potential. You should avoid anyone promising to work miracles with your credit rating in a short time – especially if they want to charge you. There’s nothing they can do that you can’t do yourself for free. But one nice thing about bad credit history is that there are limits to how far back lenders look. Even a few small moves forward can make a big difference when it’s time to actually apply for a loan.

Finally, you can consider a less-expensive vehicle. Maybe the car or truck you really want is new or relatively new. But the dealer has an older option with similar features and a decent used vehicle warranty. It may be easier to borrow a much lower amount. And timely repayment improves your credit history just as reliably as paying twice as much would do. It’s not always easy to compromise. But try to look at the big picture and the long game as well as the immediate situation.

Trade-Ins, Down Payments, and New vs. Used

Trade-ins are a crapshoot with car dealers. It’s difficult to know how much they’re really giving you, but you can at least go into the process with a blue book value for your existing car and do a little research about the most likely vehicles you’d like to buy and what they’re selling for in your area. It can be tedious, but it can also save you literally thousands of dollars over the life of the loan – and that ain’t nothing.

Down payments are a bit more straightforward. If you can reasonably afford to pay even a few thousand dollars down on your new purchase, it can shave a substantial amount off of your monthly payments. It might also allow you to shorten the life of the loan, which saves you even more on interest over the life of the loan. What might seem like a small chunk each month adds up quickly in three or four years.

Finally, buying a new car vs. purchasing used is a major decision. New vehicles are, of course, new – which certainly has appeal. The smell alone may feel worth the extra money and extended life of the loan! Then again, you can buy “new car smell” in a spray and shave off up to half the cost of the vehicle… so there’s that. Generally, you’ll find financing a new vehicle to be a bit easier. The car or truck itself acts as natural collateral for the loan. And dealers are generally anxious to move new cars and trucks off the lot more than they are their inventory of used vehicles. Used cars, of course, cost considerably less to begin with. Some dealers offer pretty solid warranties on their previously owned inventory. And insurance will be much less than it will for a new vehicle.

It’s all up to you, but these are decisions that are much easier to think about before you’re standing on the lot, staring down the row of shiny new toys. But I digress – we were talking about where to look for the best loans…

Dealership Financing

Dealer financing is in many ways similar to what you’ll find at your local bank or credit union or with most online auto loans. But it can present a few wrinkles which may be to your advantage or may not. One of the biggest factors is that if you’re sitting at the dealership talking about financing, you’ve probably already selected a car or truck you’d really like to drive home. Needless to say, that can change the dynamics of the financing discussion considerably. We want you to have the vehicle of your choice, but that shouldn’t lead you to skim through details that might end up costing you more than you realize over the life of the loan.

Most major dealerships have their own financing departments. This can be advantageous to you. Because it’s not unheard of for dealers in need of moving product off the lot to cut some great deals on price. Knowing they’ll make up some of the difference through their financing. You’ll also no doubt hear of special financing offers throughout the year – no money down, zero percent interest, etc. These also tend to come when dealers are in need of moving vehicles. Finally, dealership financing is available whenever the dealership is open – nights, weekends, whatever. When you’re ready to buy, they’re ready to finance you. (Then again, that’s true of online auto loans as well – but still…)

On the flip side, dealerships know that in the 21st century, they can’t make the sorts of margins they used to on each car or truck they sell. The internet and the proliferation of information available to consumers means they have to become increasingly creative about where they can squeeze out profits. If you’ve bought a new car in the past, you know how quickly the “oh-by-the-ways” add up after you think the price is settled.

“Oh, by the way – there’s a fee for driving the car off the lot. Standard stuff, don’t worry about it.”

“Oh, by the way – you’ll want the extended warranty on parts and transmission. Pretty typical, I’ll just add that on.”

“Oh, by the way – you should get this extra thing here everyone does. It’s on line 72 there. Can you initial next to that?”

“Oh, by the way – local taxes and fees. And tag and wheel-cleaning surcharge. And the cost of all these spotlights and balloons… just sign right there at the bottom…”

it’s not unheard of for dealers to slip in extra fees or charges to the financing paperwork. They know you’re anxious to wrap it up at that point. And unlikely to argue over a few hundred dollars here or a few monthly add-ons there. And maybe you won’t. But don’t let your desire to get on the road persuade you to smile and nod and sign on the dotted line. You haven’t committed yet, and if you don’t like what they’re offering, you can still walk away.

Honestly, more of us should sometimes.

Finally, don’t get fixated on the monthly payment being offered. It matters, absolutely – it’s very important that you be able to confidently make that payment every month on time. But look at the cost over the life of the loan as well. Manageable payments for an extended number of months still add up to a major investment. Don’t sign until all of the numbers make sense to you and your questions are answered.

Conclusion

It may seem a bit overwhelming, considering everything at once, but you’re going to do fine. The key is to keep your information organized and not let yourself be rushed into anything you’re not comfortable doing. Sit down with several lenders and explore online auto loans as quickly or as methodically as you choose. Don’t let dealers persuade you that you have to leave with a car or truck the first time you visit. Or the second, or the third. Buy when you’re ready to buy.

We can’t tell you which vehicle is best for you. And we’re not going to tell you what offers to accept. Or whether to accept any of them at all. Our expertise is connecting buyers with online auto lenders who then compete to offer you online auto loans. This flips the traditional dynamic associated with getting an auto loan or any other kind of financing. There’s no reason you should go from lender to lender begging for credit. You’re the customer, whatever your credit rating or credit past. They should be working for your business, not the other way around.

We’d like to think it doesn’t stop with a car loan or any other single transaction. At OfferEdge, we’d like to become part of your overall financial health and progress. Whether it’s loans, investments, taxes, budgeting, or anything else related to making your money work for you instead of you always working for your money, let us show you what we can do. Maybe it’s a little idealistic, but we believe things can be better than this.

In the meantime, let’s see what we can do about hooking you up with those lenders. Just between you and me, I’d pass on the upholstery protection package.

How Do Car Payments Work: Follow This Lane

So you think you might want to buy a car? The thought of buying a car sounds exciting to me, well I should say the thought of having a new car is exciting to me. The thought of actually going through the process of buying the car makes me feel sick to my stomach. I am not exaggerating. It truly makes me feel like I have a rock in my stomach. The process takes so long. I cannot tell you how many times I have spent my whole day at a car dealership. With the technology of today, it just should not take that long.

Car buying seems to be the one thing that has not gotten faster with time. These feelings begin before I even think about the car payments. For me, car buying is a tense and uncomfortable situation. It does not have to be that way. You can be prepared. And you can have your loan in order. You can get in and out of the dealership in a few hours, instead of being there all day. Continue reading to learn some of the tips I have picked up over the years about car buying and car payments.

What Is An Auto Loan?

An auto loan is sort of like a personal loan, but at the same time, it is not. Like a personal loan, you can get an auto loan through a credit union or a bank. Unlike a personal loan, you can also get an auto loan through the car dealership. When you get the loan through the car dealership, sometimes they have their own finance group and it is through them, like Honda. Other times, the car dealership uses a lending source other than themselves. It completely depends on the dealership.

An auto loan is considered a secured loan because the car you are buying becomes collateral. This means that if for whatever reason, you do not pay the loan, the lender can, and certainly will, take possession of the car. The lender technically owns the car until the time you pay off the loan. When you pay it off, you get the title and it becomes yours.

A point to consider when you obtain an auto loan is the lender makes you have full coverage auto insurance. They really do not give you a choice in the matter. If you want a loan through them, you must have full coverage. They want to make sure the car is fully protected in the event of an accident. After all, the lender has a vested interest in what happens to the car as long as you making car payments to them.

If you have a good credit score, you will receive a lower interest rate. Since the car is collateral, the lender is not taking as big of a risk by lending you money. Auto loan repayment schedules are often longer than a typical personal loan. You can take up to seven years, or longer, to pay back some auto loans. This may help to reduce the amount you pay each month. However, that also means you are paying the loan for seven years and therefore stuck with the vehicle.

How Do I Make My Payments?

This could depend on a number of different factors. The main factor being the lender. The lender often dictates how and when you make your car payments. Some lenders want to debit your car payments directly from your bank account. If you are someone like me, this is a great plan. I prefer to have the money come out of my account automatically so that I do not have to do anything. I put a reminder on my phone a couple of days in advance to remind me the money is coming out of my account. This way I can double check my account to make sure the money is there and I am all set.

Now, if you are someone that never has money in their bank account, this might not work for you. I know several people that move most of their money to an interest savings account and pay for everything with a credit card. When it comes time to pay the bill, they move the amount of money they need from their savings to the checking and pay one bill, the credit card bill. This way they are always earning interest on what is in their savings account. They only pay one bill from their savings account. They feel this is a safer way to pay for things. Everything is paid with the credit card. It works for them and it seems like a good system for them. It is not for everyone.

However, this means that they rarely have any money in their checking account. Some bills, or loans cannot be paid with a credit card, so this bill may have to come directly from a bank account. It really depends on the lender. These are details you should determine before you sign any paperwork or agree to any type of loan.

How Does Interest Impact My Payment?

The simple answer is simple, the higher your interest rate means the higher your car payments. The opposite of that is also true, which is the lower your interest rate means the lower your car payments. Your credit score drives your interest rate. You should understand a few things about interest rates first. The amount you want to borrow is called the principle. Lenders added the interest rate on top of the principle amount you borrow. Lenders that see loans as a lower risk are given a lower interest rate. It is better to get good credit auto loans so you can have a lower interest rate.

I will use numbers to illustrate this (keep in mind these are just estimates, not actual numbers):

You want to borrow $30,000 for a car. Due to your good credit, the lender adds 10 percent interest. You lower payments, so you pick a 48 month, or 4 year, repayment period. 10 percent of the $30,000 you borrowed is $3,000. The principle amount is $30,000 + $3,000 interest = $33,000 you are borrowing. Your monthly payments are $687.50. That is $33,000 divided by 48 months.

Now, the same car with bad credit: You are still borrowing $30,000 but your credit is bad, so the lender adds 20 percent interest to your loan. 20 percent interest is really high and equals $6,000. So, you have a principle of $30,000 + $6,000 interest = $36,000 total. Your monthly payments are $750.00. That increases your monthly payment by about $63 per month. For a $30,000 car, you are paying over $700 per month.

Can I Use A Credit Card?

You most likely can use a credit card to buy a car and then you would not have any car payments. Depending on the dealership, they may have some restrictions on using a credit card. They may not let you use a credit card to purchase a car. There is a fee issued to the dealership by the credit card company when you use a credit card. The fee is 1 percent to 3 percent. The dealership may not want to pay that fee. Also the  dealership makes money when you finance a car through them instead of paying for it in full.

A car is expensive, so if you use a credit card, you are putting a lot of debt on it. If your credit card has a high interest rate, you may not be able to afford to pay the balance. In this case, you could receive hefty interest charges. Those credit card charges may be higher than if you applied for an auto loan. If you have a credit card offering 0 percent interest with enough available credit, it could be a good idea to use a credit card. If you cannot pay off the credit card before the special interest ends, you could get all of those interest charges.

Can I Pay Cash?

Well, you certainly could pay for a new car in cash. This would prevent you from making car payments. It may not be the best way to buy a car. You must take a few things into consideration. One is that a car is going to depreciate as soon as you drive it off the car lot. It could end up that if you finance the entire amount of the car because you do not have a down payment, at some point you owe more on the car than it is worth. For this reason, it may make better sense to pay cash for the car so that you own it outright.

However, if you have enough money to pay cash for the car, better use of the money might be to put it in an account where it can earn interest and grow. You could take out a loan and pay the monthly payments with the amount you have in a savings account. However, what might make the most sense is if you take half of the money and put it as a down payment for the vehicle. This way you are only financing half of the cost of the car. The car value is still more than what you owe and you are able to put some money in a savings account and let it gain interest. This also keeps your car payments low.

How Do I Know If I Can Afford An Auto Loan Payment?

This is a fairly important question. It is really important to know if you can pay the monthly car payments before you agree to the loan. You are putting yourself in a terrible position if you do not verify this first. Honestly, the best way to know if you can afford to repay the loan is to look at your budget. What? You do not have a budget. Is that what you just muttered under your breath? My first response is why not? My second response is you should get on that. All joking (not really) aside, you really should have a budget. It is the best way to understand your financial picture and in this case, know if you can afford to pay back a loan.

If you do not have a budget, you can quickly put one together. A quick way to do this is list all your income in one column. Then list all your expenses in a separate column. Add up all of your expenses and subtract it from your income. Hopefully you have a positive number. If you have a negative number, you should stop here. Buying a car is not for you right now. Perhaps you should consider cutting some of your expenses before you buy a car.

Once you figure out your budget, you can use an online auto loan estimator. This helps you determine how much an auto loan will cost you each month. You can input the vehicle amount, the interest, and the length of the loan. Also, you can adjust these numbers and see how they change your monthly payment amount. You can compare this number to what your budget is telling you that you can afford. Hopefully this number is not more than what you can afford. If so, do not buy this car. Find a cheaper one.

Can I Negotiate?

When I was younger, I did not realize things, such as interest rates and car payments, were negotiable. I have since learned that if you are willing to haggle, you just might find yourself a better deal. I have also learned that it is a smart idea to negotiate the terms of my loan. You can negotiate many aspects of your loan, including pre-penalty payment, loan origination fees, and the overall length of the loan, in addition to the interest rate. You are also able to negotiate the warranty and free upgrades. If you are trading in a car, you can negotiate the value of the trade in.

There is a way to negotiate the cost and value of all of these items without being a jerk about it. You do not know what the dealer is willing to give you until you ask. Lenders are not going to give you the best terms outright. Remember, they are in the business to make a profit. The more discounts and deals they give you, the less of a profit they are going to make.

Can I Get An Auto Loan Through A Car Dealer?

Yes, I briefly mentioned early that you can obtain an auto loan through the dealer. Many people often pay for their cars this way. It is a convenient way to get an auto loan. Since you are already at the dealership, you can get the loan there and not have to deal with any other lender. Every time I have bought a car, I did not go into the dealer planning to leave with a new car. It just happened. Since I was not prepared to buy a car, I had not gotten any type of financing for the car. I had to get my financing through the dealer.

This can be a blessing and a curse. It is incredibly convenient to have the car and financing all in one place. Due to its convenience, I never knew if I was really getting the best deal I could find. I did not do an auto loan shopping, so I just took what was offered. Maybe I could have gotten a better deal somewhere else with lower car payments, but I will never know. I cannot go back and change the past, but I know now for any future cars I purchase. You can also learn from my mistakes. Do not take the first option that comes your way. It may be the best deal, but do some research first and find out.

How Does My Credit Impact An Auto Loan?

The short answer is your credit determines your car payments. Of course there is a much longer answer too. Here it is. Unfortunately, your credit impacts just about everything you do in life. It impacts how much you pay for a house, if you even qualify for one. It impacts if you can rent an apartment, or get insurance. In some cases, your credit can prevent you from getting a job. For real, a bad credit score can really hurt your chances at living the life you want.

I will dig a little deeper into credit reports and credit scores to talk about how you can find your credit score and what it means. First, your credit score appears on your credit report. They are not the same thing. People often mistakingly refer to them interchangeably. Your credit report shows a detailed list of all your credit activities. It shows how much debt you have and how you have used it. And it shows how much credit you have been given.

Your payment history, the good, the bad, and the ugly, it shows everything. You cannot hide anything from your credit report. It lists all of your late and missed payments…yes, every single one of them. You can also find information about loans on which you have defaulted. And it shows if you have filed for bankruptcy. It takes a long time to build up a good credit score. But it can plummet quickly with just a few late or missed payments.

A typical credit score ranges anywhere from 350 to 850. Most people have a credit score between 600 to 750. Good credit is between 670 to 800. Anything below 570 is considered bad credit. When you have bad credit, it is much harder to get a good interest rate. You may find it is difficult to be approved for a loan.

What If I Have Bad Credit?

You should prepare yourself now, if you have bad credit, you will have to pay a higher interest charge which means your car payments will be higher. If you already think you have bad credit, there must be some reason why you feel that way. You should pull your credit report. You are entitled to one free copy of your credit report per year.

When you get your credit report, you have a chance to see what your credit score really is. This lets you see what a lender will see to help prepare you for their questions and response. This gives you an accurate picture of your credit score. Maybe what you thought was there really is not. When you know for sure, you are able to make necessary changes. If there are items on your credit report that are incorrect, you can fix them. Just fixing discrepancies could increase your credit score.

It is possible to get auto finance if you have bad credit, however, you may have to work harder for it. You may have to do some research to find the right auto lenders for you. It is important to make sure whatever you loan you take that you can repay it. The worst thing you can do is get a loan that you cannot afford. You just put yourself in a worse place financially. You can check right now whether there is a reputable lender out there who would give you a loan in your situation.

What Is The Process For An Auto Loan?

I have talked a lot about how time consuming it is to buy a car, but I have not told you much about the process itself. Your experience may be a little different from dealer to dealer, but the basic parts remain the same. You can also save yourself time and money by doing some research ahead of going to the dealership. And you can determine if you qualify for a better loan from another lender. You can research exactly what vehicle you want and all the upgrades and features it needs to have. Let us say that you have picked out your exact car and you know that you want to finance it through the dealer.

Most dealers have a finance department that handles the financing right there. The upside to this is someone is always available no matter the time or day. The downside is it may only be one person for the entire dealership, or several dealerships. This is where the time comes in. There is a lot of sitting around for you while you wait. You pick out your exact car and fill out all the loan paperwork. Someone whisks off the car to detail it and check it over one last time. The finance person sits down with you and tells you what he can offer you, including the amount of your car payments. He goes off to work some magic, although it is slow magic. He gets everything processed and hopefully your car is ready to go when you are. That is the basic process of buying a car.

Should I Save The Money?

Saving money is always a good idea. As a general rule of thumb, you should already be saving money. I know someone that saved the money to buy a car and once she bought the car, she took the money she would have spent on a car payment and put it in the bank. When she had enough money to buy a car, she used that money and bought a new car. She did not buy a new car until she had all the money saved. If something happened and she needed a new car before she had enough money saved, she bought the car she could afford with the money saved.

That is one way to handle purchasing a new car. It prevents you from taking out more debt. It prevents you from having to make car payments. If something unexpected happens one month and you cannot afford to save the money, then you do not really lose anything. It may take you a little longer to save, but you are not hurting your credit or your finances. I hate to say there are any downsides here because I do not want to deter any one from saving money.

There are some points to consider. Car prices keep rising, so you have to be careful in the amount you are saving each month to ensure it will be the amount you need. You have to be dedicated to saving the money. Otherwise there may always be something more important that pops up. I think it is an excellent way to save money for a car and certainly could decrease the amount you pay in monthly payments.

Conclusion

I have walked you through the good and the bad of car payments. I do everything I can to avoid car payments, but I realize it is a necessity. Make sure you make smart and informed decisions when it comes to buying your next car.

What Lenders Offer the Best Auto Loan Rates?

Shopping for a car is not something most people enjoy doing. If you are like me, you avoid shopping for a new car at all costs. It is a necessary evil because I need a car to get me from place to place.  Buying a car does not have to cause anxiety. It takes just a little bit of research and education. If you do your homework before entering a car dealership, the process is much easier. Continue reading to find out the ways to make car shopping easier, as well as how to find the best auto loan rates.

What Is An Auto Loan?

When auto loan shopping, it is important to have a good understanding of an auto loan. You may be most familiar with personal loans, but auto loans are slightly different from a regular personal loan. There are a few different ways you can obtain an auto loan. It can be through a car dealership, a bank, or a credit union. Auto loans are considered secured loans as the car you are buying becomes collateral for your loan. If you do not make your payments, the lender may repossess your car. You do not own the car until you pay off the loan.

When you get an auto loan, the lender allows you to borrow a set amount of money. You promise to repay that loan by making regular monthly payments. The lender adds interest on to your loan as a fee for allowing you to borrow money. This is the case for all types of loans. The interest rate varies from lender to lender and it is based on your credit score. The better your credit is the lower your interest rates tend to be. It is important for you to shop for the best auto loan rates. Most lenders require you to have auto insurance with full coverage. They want to make sure you have full protection in case you are in an accident.

Are There Different Types Of Auto Loans?

When looking for the best auto loan rates, you should understand the different types of loans. There are secured and unsecured loans. I mentioned secured loans in the proceeding section when I talked about loans from the dealer. A secured loan has collateral attached to it to make it less risky for the lender. In other secure loans, the collateral can be any item of value. However, in an auto loan, the car you are purchasing becomes the collateral.

Another type of loan is a personal loan that is unsecured. This means that there is no collateral attached to it. If you do not make your payments, the lender would not have collateral that the lender could take. This makes the loan a little more risky for the lender. There are many different types of auto lenders, so you should research them before deciding on one.

Online Auto Loans – Get Best Loan Rates

You can always look online for an auto loan. Often, you can find the best auto loan rates online. Many websites compare the interest rates and loan options for different lenders and present them to you online. Another great thing about auto loans online is that it is fast and easy to apply for a loan. You fill out the application and submit documentation all on the lender’s website. It takes minutes and you never have to leave your home. You usually find out if you were approved in 24 hours. If you are approved, the money is in your bank account the next day.

In the past, online loans were considered to be only for those with bad credit. That is no longer the case. Many people with all types of credit are turning to online loans because of the ease with which they can apply. They are also enticed by how quickly money is deposited into their bank account. A downside to online loans is they tend to have higher interest rates. You should also pay attention close attention to the online lenders in which you are interested.

There are some shady online lenders. I am sure you already know that there are always people looking to scam others, so you must be careful. You want to find out everything you can about any online lender you are considering. All lenders have to be certified in your state, so make sure they are certified to lend in your state. Make sure they are a legitimate business.

Auto Loan Rates When You Pay with a Credit Card

Yes, you can use your credit card to purchase a car, most of the time. The dealership where you would like to buy your car may have some restrictions on if you can use a credit card. They may not let you use a credit card to buy a car. You can use it for services or parts, but not to purchase the car. When you use a credit card to make a purchase, there is a fee for it. The dealership has to pay the fee, which is usually anywhere from 1 to 3 percent of the cost of the car. Some dealerships do not want to pay that fee. They can make more money if you finance the car through them, so they require you to finance the car.

You are probably better off if you search for the best auto loan rates you can find. Cars are expensive and that is a large amount to charge to your credit card.  Depending on the interest rate on your credit card, you may have incredibly high payments. If you are able to pay the balance in full after you charge the car, then maybe it is a good decision for you. Another consideration is that you have enough available balance on your credit card to pay for the card.

If you can find a credit card that offers you a special promotion of 0 percent interest for a specified amount of time, that might be a good idea. It is only a good idea if you can pay off the credit card before the time period ends. Otherwise, you could be charged for all of the interest. It may be a negative impact to your credit, also because it increases the balance you are carrying on your card. It also increases your debt to income ratio. You should really carefully consider if using a credit card is the best idea for you. Just because you are able to do so, does not mean you really should.

Auto Loan Rates When You Get a Car Loan from a Car Dealership

Yes, you can always attempt to obtain a loan from a car dealer. Usually when you finance through a dealership, the car maker is who finances the loan. For example, if you want to buy an Accord, Honda is the company that finances the loan. Sometimes, going through the auto dealer makes financing easier for you. You do not have to go on a search for the best auto loan rates. Getting a loan through a dealership prevents you from having to do all the comparison shopping for loans. The dealership handles all of the financing for you. When you decide to finance through the dealership, you already know what vehicle you want and how much it will cost, so you know how much needs to be financed.

Can I Get An Auto Loan With Low Income?

It is possible for you to get an auto loan if you have a low income. Be warned, it may not be easy. You should also pay attention to make sure the lender is legitimate. There are many people in this world just waiting to scam those in desperate situations. Make sure that any lender you use is certified to provide loans in your state. There are some tips for you to consider you are trying to get the best auto loan rates on a low income.

You need to do some research and shop car loan rates available to you. It may take you a little bit of time upfront, but it can save you a lot of money in the end. You may need to consider having a larger downpayment to show the lender you are serious about paying off the loan. Some lenders want you to have up to 30 percent for a down payment. This also decreases the amount you need to finance, which makes your monthly payments lower. If your monthly payments are manageable, you are able to pay them. You might want to consider having a cosigner. This person’s name is on the loan and is agreeing to make sure you pay the loan. If you do not repay the loan, then the cosigner is responsible for paying it. This loan shows up on both of your credit reports.

You should have all of your paperwork with you when you go to buy the car. If you receive other types of income that may not be reported for tax purposes, such as child support, alimony, or Social Security, you should bring proof with you. You may need proof of these funds to secure the loan. Make sure you have proof of identification and insurance with you. You do not want to have anything delay your ability to obtain a car loan.

Auto Loans with Low Income: Ride Here

Does My Credit Matter?

Yes, it absolutely does! Your credit always matters any time you want to borrow money. There are many ways in which your credit impacts your loan options. You should be aware of these items before you begin to look for the best auto loan rates. Having more knowledge makes it easier for you to get the loan you want. I mentioned above how your credit score impacts your interest rate. The lower your credit score is means the higher your interest rate is going to be. You should have all the information you can about your credit report and credit score so you can understand what type of credit you have and the loan for which you may be eligible.

Some key items you should know about your credit score are it is available for you on your credit report. This report shows a listing of all of your credit activities. It has items such as payment history, your current and past debts, and indicates how you use your debt. Also, it lists late or missed payments, as well as any on which you have defaulted. It takes time to build your credit, but only a few missed or late payments destroys it. It gives lenders an idea of your credit worthiness. Credit scores range from 350 to 850. The average person has a credit score between 600 to 750. A good credit score falls between 670 and 800. A credit score that is below 570 is considered bad credit. This score or lower makes it challenging to get a loan with a reasonable interest rate.

What If I Have Bad Credit?

Get an Auto Loan with Bad Credit

There are a few items you should put on your to do list before you begin searching for the best auto loan rates. You should absolutely do these things if you know or suspect you have bad credit. While it is not the best scenario to have bad credit, if you know ahead of time, you can make sure you get the best deal. There are places where you can get bad credit auto loans.

Lenders want you to be honest with them. Many are willing to work with you, but you have to be upfront. If you think you have bad credit, you should first pull your credit record. When you look at your credit record, you can see all the items listed. There could be errors on your report. If there are, fix them immediately. Taking a few simple steps to correct what is listed on your report can increase your credit score.

You should work hard to improve your credit score. One of the top reasons for a low credit score is late payments. You should make sure all of your payments moving forward are on time and for the correct amount. It takes consistent work to improve a credit score, but it is possible. After making six payments on time, you should begin to see an increase in your credit score. I know that it seems like it takes forever, but that is what it takes consistent work.

You should decrease your debt, which increases your credit score. You can work to increase your income by getting a part time or side job. This helps to improve your debt to income ratio as well as giving you more money to pay towards lowering your debt.

How Do I Get The Best Loan For Me?

One of the top ways to find the best auto loan rates for you is to understand what you can afford. This is where a budget comes in. I know, you do not want to talk about it. But, we are going to just a little further down in this article. It is important. There are some other ways to make sure you are getting the best loan for your needs.

You should always look for a loan with the lowest interest rate. The value of a car goes down immediately after you drive it off the lot. Cars do not typically hold a lot of value. Keep in mind, I am referring to the average car, not a antique or a one of a kind vehicle. Those are different and not what the average person shops for when needing a car. If you obtain a loan with high interest, at some point you may owe more on the loan than the car is actually worth. This can be a problem if the car is totaled in an accident. In those cases, the insurance company may not give you enough money to pay off the loan. Pay special attention to your interest rate and the total amount you are going to pay for the car.

You may not want to read this, but the best way to get a great deal on a loan is to shop around. Car dealers offer financing options, but so banks, credit unions, and other lenders. If you are not set on a specific type of car, you may want to shop for your car based on the best loan deal the dealership can give you. The options may change from dealer to dealer.

What Should I Expect During The Auto Loan Process?

If you have ever purchased a car or been with someone who purchased a car, you know it can be a long process. Even with advances in technology, the car buying process still seems to take a long time. There are some reasons for this, the first being that if you finance through the dealer, they have to go through the entire loan process. Often car dealers have a loan officer on site, but it is usually one person working for the entire dealership, or even multiple dealerships. You are waiting around because that person is working on multiple people at the same time. You can decrease some of this wait time by already having your loan approved before buying the car. The more you have accomplished ahead of time, the less involved it is in that moment.

If you are trading in a car, they have to asses the car to determine the value and that adds time. You have to fill out loan paperwork, which you guess it, adds more time. All of these little steps along the way add up to more time you are sitting at the dealership. You should research the best auto loan rates, so you already know where you want to obtain the loan. If you get it from another source, you can walk into the dealership with money in had and that cuts your car buying time in half.

What Is A Loan Calculator?

A loan calculator is a tool that you can use to determine which are best auto loan rates for you. There are many available online. All you have to do is search for loan calculator to find one. It helps you calculate the payment you make each month based upon your down payment, interest rate, and the length of the loan. You can change those amounts to see what the monthly payment is and help you determine if you can afford it. A loan calculator can also help you adjust your idea of what you can afford. You may think you can afford a car that is $40,000 but when you see the monthly payment, you realize that you cannot afford it.

It is a fairly simple tool that you can find online, but it easily helps you determine the best auto loan rates for your current situation. It also requires you to be honest with yourself about what you can afford to pay each month. This is also why a budget (see next section) is helpful to you. It can help you understand what you truly can afford, not just what you want to be able to afford.

Do I Need A Budget?

Yes, you need a budget. Not just to find the best auto loan rates when you want to buy a car, but in general. If you do not have a budget, you should stop right now, click here and use the tools on the website to create a budget. Simply put, a budget gives you an understanding of how much money you make and how much you spend. It allows you to see how much money you are spending and where. It may even surprise you how much money you spend without even realizing it. A budget allows you to be in control of your money and not let your money control you.

It is important to understand how much you can afford to pay each month when you are looking for the best auto loan rates. The easiest way to determine how much you can afford is to list your income in one column and list all of your expenses in a separate column. Then you add up the expenses column and subtract it from the income column. Hopefully, you have a positive number after doing that. Many people do not. The amount of money that you have left is what you can afford to pay each month for a car loan. If that number is much less than you thought it would be, now is the time to make some adjustments to your spending.

Since you have listed out all your expenses, you can begin to reduce them. You can start with easy items, such as any memberships that you are not using. If you have a gym membership and you have not been there in months, cancel it. Unless you have an injury preventing you from going, most likely you are not going back. Now is the time to cancel that membership and you have instant savings. Determine if there are any other subscriptions that you have automatically deducted each month. Change them from automatic to something you have to control. When you control it, you can decide if it is something you really need instead of it just shipping automatically.

After that point, it gets a little harder. Now, you can take a look at how much you eat out. I mean look at everything, including coffee runs and trips to the convenience store for a snack. You should cut out as much of that as you can. Start small and reduce all the times you eat out by half. It may surprise you how much you see in savings. It may encourage you  to further reduce the amount you eat out to save even more money.

Conclusion

The key takeaway is that you must do a little bit of research to find the best auto loan rates for you. You know what is in your best interest and you should drive the decision. Take a hard look at your budget and determine what car you really can afford. It may not be the car you really want. Then you must determine how hard are you willing to work for the car you want. Are you willing to get another job? Are you willing to cut your spending? That car may be worth it to you to do all of those things, but you have to make those decisions for yourself.

Auto Loans with Low Income: Ride Here

There are many reasons you might consider getting an auto loan. Are you purchasing a new or used car and do not have enough money in the bank to pay for this vehicle out of pocket? Are you looking for a chance to refinance an auto loan you already have? If either of these situations reflect your own personal situation, then it may be time to consider getting an auto loan? Are you concerned about being able to buy the car you need because you have a low income or bad credit. Don’t worry — it is possible to get auto loans with low income and bad credit. You can even get auto loans for bad credit online.

How to Get an Auto Loan with Low Income

Getting a personal loan is so easy it can be done in three simple steps. If you are looking for auto loans with low income, then you may feel like your task is impossible. Trust me, it’s not. You can do this. Searching for auto loans with low income just requires you to work a little bit harder. For instance, you cannot be afraid to ask for help. There are many companies whose sole purpose is to help consumers find auto loans with low income.

These companies offer their services for free and help consumers find a local dealership in their area that will help you find auto loans with low income. Or they help you find a lender that is right for you. You usually apply by filling out a short form online that can be completed in just a few minutes.

When it comes to getting an auto loan with low income, patience is the key. You may stumble upon several obstacles, and surely getting a loan will not be as easy. But it is far from impossible. With the right help, you may find great auto lenders and get approved for a loan.

How to Get an Auto Loan with Bad Credit

While we’re at it, let’s talk about another unfavorable situation – bad credit. Same as with low income, bad credit is an obstacle to getting a loan. It will not stop you from getting a loan, but it can hurt your chances of getting a loan with a low-interest rate. In fact, if you are looking for an auto loan with bad credit, then there are auto loans out there made just for you.

In order to get auto loans with bad credit, you should consider requesting a meeting with a loan officer. At this meeting, you can show the loan officer who you are, with a positive presentation and demeanor, as well as explain what your personal situation is. This meeting can give you a leg up in your chances of getting an auto loan.

In addition to meeting with a loan officer, consider the cosigner or collateral option. If you have bad credit, then you may still be able to get an auto loan if you have someone cosign with you. This other cosigner is agreeing to the absolute responsibility of repaying the auto loan, so that if you do not pay, then the lender knows that someone will. If you are not comfortable asking someone to cosign with you, then you can consider putting up collateral for an auto loan. This means that if you do not make the payments on your auto loan, you could lose the collateral you put up for the loan, such as your car or house.

Auto Loan Basics

Auto loan basics are basics for a reason: they’re the basics that everyone should know. This does not mean you should feel bad or uneducated because you do not know something here, but if you don’t know something mentioned below, then it means you are definitely in the right place. If you are considering getting an auto loan, then you need to make yourself familiar with these auto loan basics:

What Is a Car Loan and How Does It Work?

There are two types of auto loans. You can either get direct lending or dealership financing. If you choose direct lending, then you get to make the arrangements of your auto loan with the financial institution of your choice. If you choose dealership financing, however, you will have to make the arrangements through the dealership. Both options have pros and cons, and in general, the two options are not dramatically different.

Direct Lending

When choosing to go with direct lending, you are choosing more freedom. Because you can choose whichever financial institution you most prefer, you have the freedom to comparison shop for auto lenders. Auto loan shopping allows you to find an option that fits your budget, with realistic payment options and better rates and terms. Plus, if you have pre-approved financing, then you are sometimes able to negotiate a better price.

Dealership Financing

Dealership financing can be a simpler option. You do not have to deal with auto loan comparison shopping, spending a lot of time and effort to find the auto loan with the best terms. If you choose dealership financing, then the dealership will do this for you. They will either do the financing internally — if they have their own financing department — or do the financing externally — through a finance company that they have a prior agreement with. One benefit of dealership financing is that it means you already know what car you want, which means that you already know how much financing you need before getting your loan. This could save you money in the long run, so that you don’t have to pay back even more — including that compounded interest — in the future.

The Car Loan Process

Getting a car loan isn’t very difficult, but it can be made even easier if you understand the car loan process. The first thing you should do is to use an online auto loan calculator to set a realistic budget for yourself. Once you have your budget, you should check your current credit report, so that you have an idea of what loan options you will have. It is possible to get auto loans for bad credit online, but it is a good idea to inform yourself of your situation early on in the process. This can allow you to set realistic expectations for what your loan options will be.

Before getting a car loan, it is a good idea to know what you are looking for in a car. Research is essential. If there is a specific make or model you prefer, or any special features you know you do not want to go without, then you should keep that in mind when researching the range of prices for similar cars to your preferences. Many people trust and rely on the Kelley Blue Book to see what current average prices of specific cars are.

Once you know what your current financial status — including your credit score — is and what your will be likely to have to pay on average for the kind of car you want to buy, then it is time to do some auto loan shopping online. This can help you find the best auto loan for you and your personal needs.

Auto Loan Basics Spelled Out: Lending 101

Types of Loans

Before you make a commitment to getting an auto loan, you should know what your options are. There are many types of loans out there, and there is certainly an option out there that is right for you. An auto loan is just one type of personal loan. Below are some other types of personal loans:

Unsecured Loan

An unsecured loan is a type of personal loan that does not have collateral backing it up. This means that if you do not make your monthly loan payments in full and on time every month, then the lender cannot just take something from you in order to make up for the money you did not pay. This means that an unsecured loan is more risky for lenders. Though very uncommon, it is possible to get an unsecured auto loan.

Secured Loan

A secured loan is a type of personal loan that does have collateral backing it up. Items put up for collateral are typically worth a lot of money, so that they can make up for whatever you decide not to pay on your loan. For instance, if you get a secured auto loan and do not make your payments on the loan on time, then your new car can be taken away. Auto loans are most often secured loans.

Open-End Credit

Open-end credit is a type of credit where you can “withdraw money as you need it, over an extended period of time.” Two common options for open-end credit are lines of credit and credit cards. This is a good option for someone who is, for instance, working on a project where they need to take out multiple smaller sums of money, depending on what individual expenses they have. One advantage of open-end credit is that you typically do not have to pay interest on whatever money you do not withdraw.

Closed-End Credit

This is a type of credit where you get one set lump sum. Closed-end credit is typically done in the format of a traditional loan. You request to borrow a certain amount of money, and you get that amount of money in a lump sum. Then, you must repay this lump sum, plus interest, over an agreed-upon period of time. If you decide to get a single payment loan, then you will be required to pay the entirety of the loan — what you borrowed plus interest — in one lump sum.

Auto Loan Rates

It is impossible to say what your auto loan interest rate will be without knowing your exact situation. Rates can vary from lender to lender, and dealers may push special promotions in order to quickly get rid of certain stock. Regardless of these uncertainties, there are some things you can be certain will have an effect on what rate you end up getting.

The Impact of Credit History on Auto Loans for Low Income

Your credit history will be sure to affect what interest rate you get. Though it is possible to get auto loans for bad credit online, you are not likely to be able to get an interest rate as low as someone who has good credit. On the other hand, getting a loan — and repaying the full amount due on time every month — could actually help strengthen your credit. For more information about how getting a personal loan can help your credit, read on here.

The Length of the Loan

The length of the loan can also have an impact on your interest rate. Generally, though not always, loans that will last longer have higher rates. Sometimes you don’t have a choice; if you cannot afford to take an option with a shorter loan, then get the longer loan that is more realistic for you, however, if you can afford to get a shorter loan, then that is a better option that will allow you to spend less overall in the end.

Which Car You Want

Not all cars are equal. What you buy will determine how high or low your interest rate is. If you are interested in financing to purchase a new car, then you may be able to take advantage of introductory rates or special financing. If, on the other hand, you are interested in financing to purchase a used car, then you may not be able to find such deals. This is because “used cars are considered a greater risk for lenders, since their resale value is already lower and the chances are good you’ll owe more than the car is technically worth at some point down the road.” Used cars may come with a lower sale price, but they also come with higher interest rates.

A graph showing the variation in auto loan rates by credit score.

What You Need to Know About Auto Loan Shopping

If you have decided to take part in auto loan shopping, then there are some basics that you need to know before taking action. First of all, you should budget before you shop for auto loans. If you budget before beginning auto loan shopping, then you will be more aware of your realistic expectations in finding an auto loan. For instance, budgeting will help you determine how much you are able to pay up front for a car, as well as how much you will be able to pay in monthly payments after you get the car.

Besides budgeting, it is important to explore all of your options. This is why auto loan shopping is so important. If you take the time to look at multiple auto lenders, then you will see what options are available — with what terms and rates. This could help you get better rates in the end, since you usually do not get the best offer on your first try. Exploring your options will help you find the absolute best auto loan for you.

For more information about what you need to know about auto loan shopping, such as information on auto loan discrimination and how to negotiate auto loans, read on here.

Auto Loan Statistical Overview

You shouldn’t feel alone if you are considering getting an auto loan. According to the Federal Reserve Bank of New York, auto loan debt is on the rise. In fact, auto loan debt has been on the rise for the past decade, however, while people with lower credit scores — credit scores of 719 or less — have plateaued recently, people with higher credit scores — credit scored of 720 and higher — have “[continued] to grow as a percentage of total borrowing.” This indicates, among other things, that “people across the U.S. are improving their overall credit scores.” For more information about the statistical overview of auto loans, read on here.

Conclusion

Getting auto loans with low income can be stressful, but with the help provided above, the process should be much easier. You can also get help from Loanry and look into our lender recommendations.

Auto Loan Basics Spelled Out: Lending 101

Ever notice how there are things it feels safe to ask about and other things you feel like you’re supposed to just magically… know?

A friend of mine recently mentioned she’d purchased a car. She told me the color, make, and model. I asked about the engine, its features, and how it felt to drive. These are the polite things one does when someone is excited about a recent purchase, right?

What I really wanted to know, however – but didn’t feel I could ask – was how she financed it. What interest rates are auto lenders offering these days? Also, what sorts of terms can someone with average or even bad credit get? Is the process as painful as I seem to recall from when my parents were doing it a generation ago, or has it gotten any better?

Too many of us feel foolish asking about auto loan basics when there’s really no reason we should. You’re not missing some critical link in your genetic code. You weren’t skipping the day they covered auto financing in Adulting 101. Maybe you’ve simply not financed a vehicle lately. (If it makes you feel any better, I know plenty of people who have financed their cars. Those often still don’t quite know how it works.)

Let’s look at a few auto loan basics.

What Is a Car Loan and How Does It Work?

I know – it sounds so simple, right? But for most of us, purchasing a car is one of the biggest and most important financial decisions we’re going to make. Surely that’s worth a little planning ahead?

There are two basic types of auto loan: direct lending or dealership financing. With direct lending, you make arrangements with a financial institution of your choice. Usually before you buy. Your

Source: Federal Reserve Bank of New York via Finder

local bank, credit union, or other auto lenders are usually happy to share their current rates and terms with you. This gives you the freedom to comparison shop ahead of time. You can figure out your budget and realistic payment options before even talking to a car dealer. Pre-approved financing can sometimes help you negotiate a better price. Especially since your funding is already secured.

Dealership financing is not dramatically different. However – as the name suggests – takes place through the dealership. Some automakers have their own financing departments. It means your loan is actually through them. Most have arrangements with outside finance companies. They transfer your loan to them before your first payment even comes due. Dealership financing offers you additional convenience in that you know exactly what car you want. You also know how much you need to finance before setting up the loan. Plus, it’s available whenever the dealership is open. Either late nights, long weekends, holidays, etc. Dealers also love running promotions with special interest rates or other terms which you might find appealing.

Did you know?

The average new car loan in 2018 was $30,977, while a used care loan was $19,861. Generally speaking, a higher the credit score results in a higher loan amount. Another interesting stat is those in the 2nd highest credit tier borrowed the most coming in on average at $32,630 for new cars and $21,293 for used ones.

The Car Loan Process

Don’t feel foolish if you’re not sure how to shop for a car loan. Auto loan shopping isn’t difficult, but it is different than it was a generation ago.

The good news is that technology has made it easier than ever to get started. The first thing to do is to figure out a realistic budget using an online auto loan calculator. In the 21st century, this is an essential requirement of Auto Loan Basics 101. Most versions will let you play with interest rates, lengths of the loan, and other factors to figure out what works best for you. Then, check your current credit report. The earlier you begin this part, the easier it will be to address or correct any errors.

It’s also a good idea to research your vehicle options ahead of time. This should be part of everyone’s auto loan basics, but sometimes our emotions take over and we get careless. Make note of what features you consider essential and which would simply be nice to have. Check the range of prices you might be able to negotiate using sites like the National Automobile Dealers Association, Kelley Blue Book, or Edmunds.

Once you’ve got your information together, you’ll find auto loan shopping online to be relatively painless. You’ll probably be surprised how quickly you hear back from multiple auto lenders. Obviously you should consider each offer carefully before committing, but personally, I much prefer having lenders compete for my business over the old way. Maybe our parents were willing to slog from lender to lender, sit in an endless array of hygienically-suspect chairs, and endure suspicious looks and questions from disgruntled loan officers, but you don’t have to.

Unless you’re just into that sort of thing, of course. In that case, have fun.

How Is Auto Loan Interest Calculated?

This is another part of auto loan basics which too often makes us feel foolish when there’s no reason we should. Most auto loans involve simple interest, meaning you pay interest only on the principle of the loan (the actual amount borrowed to pay for the vehicle and related costs like taxes). The alternative is compound interest, in which the borrower pays not only on the principle amount but on any remaining interest owed – interest on interest, as it were. Usually you only want to hear the term “compound interest” when you’re earning money on your savings!

If you want to dive into the nitty gritty details of what interest can look like over the life of your loan, check out this breakdown by IFS. They explain it quite effectively with plenty of visuals.

Who Offers the Best Auto Loan Interest Rates

Source: WalletHub

How Do Car Payments Work?

This is an easy one, right? They send you a bill each month and you mail in your check. Done!

It’s true that once you have the car and have signed the paperwork, the terms are largely set and you should pay what you owe each month. That’s foundational to auto loan basics. But let’s look at those payments and what goes into them ahead of time. Maybe we can avoid a few careless mistakes.

You’ve probably figured out that a lower APR (“annual percentage rate”) means you’ll pay less over the life of the loan. That’s absolutely true, but APR is not the only factor. The length of the loan matters as well.

Make Your Payment…

According to Lending Tree, “Delinquency rates for auto loans trend together including loans 30 days past due, loans 90 days past due and loans at least 90 days past due. All three peaked following the 2008 downturn, with 30-day delinquencies spiking to near 11% in early 2009, but have stayed around 7% since 2011.”

Let’s take an example!

Let’s say the car you want will cost you $30,000. You’ve managed to save about $3,000 in anticipation of this glorious day, but that’s clearly not enough. You check around and discover one lender who’ll loan you the full amount and let you pay it back over 48 months, another who’ll offer you 60, and a third who starts at 72. That last offer has the lowest payments of any of them and you get to keep your $3,000! Sounds good, right? And if those are the terms you want, there’s nothing wrong with that.

Still, what are you paying in total over 72 months for the same car you could finance for 60, or 48? That should always be something you consider (not just the size of your monthly payments). You’d be surprised at the difference, even if the interest rate is the same for each – and it’s probably not.

The third factor is your ability to make a down payment. Remember that $3,000 you set aside? Applying that upfront would not only make your monthly payments be lower, but the total interest you’ll pay over the life of the loan would be less as well. It might even be enough to help you do 60 months instead of 72, or 48 instead of 60, which then saves you even more.

Don’t let the complex interplay of factors intimidate you. You don’t have to take Algebra II at your local community college before you buy. Just remember those handy online loan calculators we mentioned from Auto Loan Basics 101. Run a few of the options and see what happens. It doesn’t cost you anything to play with it a bit and prepare; it might cost you in the long run if you don’t.

Auto Loan Rates

If you’re wondering what sort of interest rates you’re likely to secure for your auto loan, the solution is pretty straightforward – try several lenders and see. Interest rates vary widely over time and from lender to lender. Add to the mix the various promotional rates offered by dealers anxious to move some stock off the lot and it’s impossible to say ahead of time what a “typical” rate might be.

With that in mind, here are a few auto loan basics which determine that rate, whatever it might be:

Your credit history.

I realize this is a bummer for some of us, and believe me – I totally understand. But we might as well acknowledge up front that this is a pretty big factor in determining what we’ll be paying for our loan. On the other hand, a reasonable auto loan is a great way to rebuild or strengthen that same credit history by making sure you’re realistic about what you can afford and making your full payment on time every month.

The length of the loan.

Generally speaking, longer loans come at higher rates. Even if the rate is the same, you’ll pay more interest over time with longer loan terms. If you gotta do 72 months, do 72 months, but if you can do 60, or 48, consider those instead – even if it means dialing back on a feature or two in order to make it happen. Keep in mind that down payments may or may not reduce your interest rate, but they will reduce how much interest you’ll pay over the life of the loan.

What you’re buying.

New cars are more likely to have introductory rates or special financing. Used cars are considered a greater risk for lenders, since their resale value is already lower and the chances are good you’ll owe more than the car is technically worth at some point down the road. Pre-owned vehicles tend to cost less – which is great – but come with higher interest rates.

The lender.

Do some auto loan shopping ahead of time by comparing your online options to your favorite banks or credit unions. Scan local ads for dealer promotions and be ready to ask about special financing, then compare it to what you’ve already researched from other lenders. There’s no absolute right or wrong, best or worst on this one – it all depends on who’s offering what, when, and under which conditions.

I realize it’s not as exciting to do loan calculations and compare rates from various auto lenders and look up “blue book” values and all that when we’re buying. There’s a certain thrill to following the spotlights and the inflatable dinosaurs and test driving a few dream cars in candy apple red or adding booming stereo packages before signing on the dotted line in triplicate and cruising home covered in new car smell. It can feel good to leap before we look and figure we’ll worry about the details later.

But those car payments keep coming due every month whether we put in real time and consideration up front or not, and by about month three they’re not particularly thrilling no matter how sexy the paint job or how loud those woofers. Maybe it’s worth sacrificing a little “living on the edge” on this one in order to prioritize auto loan basics? It will reduce your stress and improve your financial security for the remaining years of the loan, which is very much a win – however unexciting it might seem compared to those inflatables.

Do Car Dealerships Prefer Cash or Financing?

Generally, dealers prefer financing, since in addition to whatever profit they make on the actual vehicle, they can count on a little extra from finance charges and the interest you’ll pay. Even if they sell your loan to an outside lender, they net a little extra when you finance through them.

That doesn’t mean you have to finance if you want a good deal on a car. If you do walk in pre-approved from an online lender or local financial institution, or with your checkbook ready to simply pay the full amount, however, you might avoid committing on how you plan on paying until after you’ve come to an agreement on the final price.

They’ll ask, of course, just like they want to know if you plan on trading anything in before they start talking specifics with you. That’s auto loan basics from the dealer’s standpoint. That doesn’t mean you have to do everything their way, however. There’s no need to be dishonest or coy, but these days, dealers realize there’s more information out there than they can control about car values and reasonable pricing. They know you have options. Don’t be afraid to proceed based on what you want to know and how you want to handle things. They’ll either work with you on those terms or they won’t, and you can try somewhere else.

“Be willing to walk away” is normally reserved for Auto Loan Basics 201. You’re ahead of the curve already!

How Does Your Credit Score Effect an Auto Loan?

Let’s start with the obvious: a better credit score will usually get you a better interest rate on your auto loan. Anyone who tries to convince you otherwise is either dishonest or delusional. Now that that’s out of the way, let’s talk about a few less-obvious factors when it comes to your credit score and getting a decent auto loan.

First, check your credit report before you get serious about car shopping. It’s a pain to fix errors, but they do happen and it can be done. Pay particular attention to anything your credit report suggests about past vehicle financing.

That brings up a second point. Lenders considering you for an auto loan are primarily concerned with your track record when it comes to auto loans. I realize that sounds a bit silly. However it’s worth considering. Let’s say you’ve done pretty well paying off two previous vehicles – or maybe one used car and one other big-ticket item like a furniture purchase. On the other hand, your credit score is unimpressive due to outstanding medical bills or other uncontrollable expenses. We agree that your overall credit score still matters. Dealerships and online lenders will notice when the issue doesn’t seem to be your ability to pay for planned purchases. Keep in mind they want your business; all they’re worried about is whether or not you’re going to pay them in a timely manner.

Finally, you’ll never get a loan for which you don’t apply. The abundance of local banks, credit unions, and online lenders means financial organizations have to take a few risks if they’re going to do enough business to compete with your other options. The world of credit isn’t what it was a generation ago. Get your information together, then ask.

How To Get A Car Loan With Bad Credit

At the risk of sounding like a broken record (ask your mom what a “record” is if you’re not sure), the most important step towards getting the loan you want, even with your credit, is to apply for the loan you want, even with your credit. Seriously, what’s the worst that could happen? A few lenders might say no, or propose slightly different terms than you’d hoped?

Now that you’re sick of me repeating that point, let’s talk about a few of the many things you can do to increase your odds when it comes to getting the best possible loan (even with your credit):

Get a co-signer.

This should be someone with a strong credit history who trusts you enough to put their credit rating on the line to help you out. If you make your payments as scheduled, your credit record improves without any change to theirs. If you don’t, their credit record is damaged and they may eventually be expected to pay what you’ve promised – so let’s take this one seriously, shall we?

Make a down payment.

It’s not a surprise that you’re going to need a car someday. Saving money is never the easiest thing in the world, but even a few thousand dollars up front can change the equation in terms of monthly payments, interest rates, and even the willingness of lenders to take a chance on you.

Look over your credit report.

Address any errors or fix any oversights on your part if possible. (You notice we keep returning to this theme? It’s like it’s important or something and yet many people simply don’t do it ahead of time. Hmph!)

Research financing options before you shop for your vehicle

Know what sort of APR (annual percentage rate) is being offered through various lenders and the typical prices negotiated for several of your top choices. Play with some online loan calculators so you understand the way various factors shape potential loan payments. Compare local banks, credit unions, and online lenders, even if it means delaying your car-shopping for few days while you do. Don’t be demanding or obnoxious, but there’s nothing like knowing what you’re talking about when you’re trying to secure financing.

Research vehicles, typical selling prices in your area, and other logistics before walking onto that lot.

Know what features are essential to you and what you can live without, and be ready to compromise a bit if the dealer has something pretty close in stock that they’re ready to move. And for goodness sake, don’t get fixated ahead of time; have several options so you can honestly walk away if you’re not happy with the terms. Know your non-negotiables and on what points you can be flexible going in – that’s Auto Loan Basics: The Prequel, my friend!

Don’t become fixated on monthly payments.

Look at overall loan terms. We talked about this above, remember? I’m only mentioning it again because the whole process can sometimes leave us feeling a bit glazed over and I figure a little reminder wouldn’t hurt. You’d do the same for me, wouldn’t you?

Bring a trusted friend or family member.

Sometimes we think more clearly if we bounce things off that colleague from work who always asks the right questions or that sister who isn’t afraid to be irritating when she knows we’re about to do something we’ll regret. Anyone familiar with auto loan basics and willing to be a second set of eyes and ears in the process. (Your spouse or significant other doesn’t count. They’re probably not really a “neutral outsider” when it comes to major purchases – at least I hope not. If they are, you’re doing relationships wrong, my friend.)

Where To Shop To Get A Car Loan

Shopping for an Auto Loan: What You Should Know

I assume at this point you’re tired of me telling you to check with your local bank and credit union. Besides, you probably know how to shop for a car loan this way – walk in, sign the list, and talk to whoever calls your name, right?

If you thought to yourself,

“But first I should check my credit report, estimate what I can reasonably afford, narrow down my vehicle options, and experiment with an online loan calculator…” then YOU GET A STICKER and ONE THOUSAND BONUS POINTS! You are officially gifted and talented when it comes to auto loan basics.

What you may be less certain about is finding reputable online auto lenders. The internet is a magical place, but you’d be foolish to stake all your hopes and dreams at the first search engine result that comes up (which was probably a paid advertisement anyway). That’s where we come in.

Conclusion

We use our expertise to connect buyers with online auto lenders. This flips the traditional dynamic associated with getting an auto loan or any other kind of financing. There’s no reason you should be overwhelmed or frustrated, going from desk to desk like Oliver Twist wanting more warm mush. What you are is a client, empowered to choose from numerous marketplace lenders who compete for your business by putting together their best solutions and hoping you’ll consider giving them your business.

These are experts in creative financial solutions who understand your situation. They exist to help people like us figure out how to figure out situations like this. Some even specialize in helping you rebuild your credit if things haven’t gone, you know… perfectly in years past.

You’re probably wondering about the catch. What are we selling you? Nothing – nothing at all. Loanry gathers some basic information and offers a few tools to help better determine your needs, then helps you find a participating lender to secure a solution both of you decide is best. We don’t charge you any fees or take any payments from you. Period. Once you’ve found a lender that meets your needs, the rest is between you and them.

Good luck, happy driving, and be safe. You’re now an expert in auto loan basics and ready to share your wisdom with others.

After you get that car, of course.