Job 1 In Car Buying – Financing First
Author: Jeff Neilan

Before you get all warm and fuzzy about a particular car that
you are looking and head off to the dealership to do battle for
the coveted chrome, get you financing lined up first.

Know how much you can borrow, at what rate, and for what length
of time. Once you do this it is very important to then plug of
the numbers on the car that you have researched into some
various length of time and interest rate scenarios… and by the
way, once you do this right the results down… don't try to
commit this to memory.

Looking at all the various scenarios between the amount
borrowed, length of time, and at what rate pinpoints for you
what the best use of your money really is. For instance, more
often than not, opting for all the available rebate monies back
to you instead of letting the dealer use your rebate money to
offer you 0% financing – is a better deal if you use that same
money as a down payment on a low interest loan. Bottom line…
plug in all the numbers – 0% isn't always the best overall
deal.

You own bank or credit union is the best place to start. If
you've been banking with your financial institution for some
time you'll have a much better comfort level beginning there.
Generally speaking you'll probably find your best available
rate at your local bank or credit union. Credit unions many
times are the lowest available.

Online lenders over the years have really refined the www
process to the point that it is extremely hassle free as well…
and many offer attractive financing rates. Online financial
companies such as Capital One and eLoan will get a check to you
in just a few days that you can either use at a dealership or
for a private party purchase.

With the recent trend in low interest rates, home equity loans
to pay off higher interest debt and even include a new car in
the transaction have become a conduit for a purchase. Although
this can be an option, I'm not a big fan of adding the burden
of a depreciating asset (a car) to your appreciating asset
(your home).

Depending upon your situation, you may want to discuss
assistance from your family. For young people or first time
buyers with little credit history it may be difficult to get
approved for the amount of purchase such as a car. If you can
make financial arrangement with a family member to at least
help you with a larger down payment, you may then be able to
get approved finance the rest. This way, you can purchase a
vehicle and begin getting a good start on establishing your
credit.

Of course, there is the dealership financing department. Be
very cognizant of the fact that the finance department at a
dealership is responsible to ownership to turn a profit… not to
offer you the lowest possible interest rate. If you go the
dealer finance options… know that negotiating the rate is an
available option. Plus… if you have already got a firm rate and
term commitment from your outside source, you can leverage this
at the dealership by having them compete for the best rate.

In summary, you not only want to line up your financing first…
even before you pick out a specific car. Then you want to plug
the amount, the rate, and various terms into your calculator
and determine what it the best deal for your personal budget
and situation. Then, and only then, should you venture out to
the car lot.


About The Author: Jeff Neilan's car dealer experience offers
insightful car buying tips that save you time and money. Be
sure to visit http://www.acarbuyersguide.com for car financing
tips, ownership costs, & more.