The Perils of Buying and Financing a Used Car

Whenever a person buys or leases a car, he seeks ways to finance this move. Most auto financing involves a car loan, which entails a detailed check on his credit history and a tough interview about car finance. When he undergoes all these to buy a used car, it is only fair that he also performs his own investigations about the car he is going to buy. In fact, he should never consider buying a used car, which history has not been checked. If he does, he may just end up paying for a piece of junk.

A used car must be checked for its title, registration, odometer, and the problems that it had weathered before it reached your eyes. A “title check” will determine if the car is salvaged, flooded or rebuilt. For example, many cars were destroyed during the 9-11 World Trade tragedy. Many cars, too, were damaged during the hurricanes and floods. These cars are salvaged by enterprising people. The cars will be rebuilt and sold again at car auctions. A title check will also discover if the used car has lemon history.

A “registration check” will determine if the used car has been used as a fleet car, or as a taxi, or even as a police car. If the used car has been utilized in any of these, then it is safe to say that within a given period of time, this particular used car has covered more miles than the average privately used car. A registration check will also reveal if the used car was ever rented or leased.

The car’s odometer is an instrument used to measure the distance traveled by a vehicle. An “odometer check” will show if the odometer has been broken or fraud. It will also show if it has been rolled back or rolled over. If the odometer has been tampered, this does not bode well for the next owner of the used car. The car may be older than what the dealer is telling you. Or it may have mileage problems.

A “problem check” will determine if the used car has sustained fire damage or an explosion. It will also show if it has been involved in a major accident. The fire or accident may have inflicted a still undetected damage on the used car. It is also quite creepy to use a car that has cradled dead bodies before. A problem check will reveal if the car has been stolen. A car that has been stolen may no longer have all its original parts. To be safe, the potential buyer must order a vehicle history report.

Auto Financing For Used Cars – Is Bad Credit Weighing You Down?

Buying a car is almost a rite of passage in today’s world of continuous rush. People need their own transportation to get by through their busy days. Yet most people will find it a huge daunting task to buy their first cars what with all the financial planning that goes in to the process. Fortunately, you can opt for buying used cars for quite a substantially reduced rate. Yet, even that solution will be troublesome if you have a bad credit situation. So, if auto financing is your most likely option and you need to deal with your bad credit score here are a few tips and information that will really help.

First of all, a bad credit score does not mean that you cannot apply for any financing arrangements or even not consider buying from a private owner. All it means is that you have to make special considerations and strategic plan for your auto financing.

Why opt for used car loans

Buying used cars means you do not have to deal with the hassles of sales tax.

Again, used car loans are in general, much cheaper than new car loans. This is why the rules for used car loans are a bit more lax than general auto financing rules.

How to get approval for Used Car auto financing on bad credit

Start by taking a self-inventory. Where does your current financial capacity stands. This will be a status check – details that most auto financing organizations will want to know from you. While submitting the paper work is important, so is knowing about all of it yourself. This will help you answer any and every question thrown at you, with confidence.

You have to take note if you are in the financial condition right now to make the auto loan payments periodically. Also, your budget will be a huge deciding factor on the limit of your auto loans that you should take out.

Reliability is a hugely important factor. So, make sure to research all your auto finance options to understand their customer satisfaction record, their experience in the field and their usual way of handling accounts of new customers.

You can opt for a private dealer purchase and for this, make sure that you have searched options of auto moan dealers who offer subprime credit. This will help you get the best budgetary considerations in the end.

Checklist of Important documents to carry for authentication of loan with a bad credit

Your credit report
Your SSN
Recent pay stubs, proof for income and employment status
Documents showing credibility of your banking history – credit card details, bank statements, utility bills
Title of the car
For used cars, you will need to show the odometer statement, car’s asking price, VIN and the year of manufacture.
You will also need to provide details of the car- make and model.

Finance For Used Cars

The majority of the problems that occur when individuals want to finance for used car are related to the importance of the paperwork. Many of us think that paperwork ought to be completed as quickly as possible so that we are able to drive with this cars right away. You shouldn’t rush into any decisions when financing a used car because there is really a significant amount of cash that you must consider and there’s no room for mistakes.

To start with, it is crucial to get the deal decided through the car salesman to be put in writing within the contract. In other words, anything must feature the monthly payments which are based on the interest rate. Speaking of the interest rate, it’s a common practice among dealerships to inflate it so that they can create a nice extra profit. If you want to avoid this and I’m sure you need to do, you’ll need to get independent vehicle financing before heading out towards the dealership. In so doing, you are able to proceed as a “cash buyer” and the only thing that you’ll be negotiating may be the cost of the vehicle. Obviously, car salesman always have preferred their customers to possess monthly obligations because in this manner it’s easier to allow them to hide some of the costs of the car.

Finance for car or truck can be obtained from a bank, on-line lender. The most common issues car buyers need to face when trying to invest in an automobile are:

a) They don’t know their credit score – because of this, you should order a duplicate of the credit report and proper any discrepancies that you simply notice. The loan bureau will specify how you can fix these errors when they send you the report;

b) They have the tendency to overspend once they reach the dealership – and that’s why you should jot down a price range for that vehicle and stick to it all the time. According to finance experts, the vehicle payments combined with the related expenses shouldn’t consist of more than 20% of your monthly net income;

c) Many car buyers go to the dealerships without having done some research concerning the current rates of interest and as a consequence, they don’t know if the speed they’re offered is competitive or not – for this reason, you should use the web to compare rates and obtain a clearer image of what you should be looking for in the dealer;

d) Lots of car buyers navigate to the dealership without obtaining the appropriate auto financing which means that they won’t have any negotiation powers when discussing using the dealership concerning the interest rates – which is why you need to get a no-obligation loan before heading out to the dealership;

e) In certain situations, the customers are confused or pressured by the staff of the dealership and although they have second thoughts, they still sign the offer – which is why you should do your homework in advance so that you can know what to anticipate from the dealer.

As you can see, there are a lot of problems that must be taken into consideration before purchasing a used car. Considering that always we’re referring to a lot of money, you’d better do your homework to be able to grab a good deal that won’t ruin your wallet.

How to Finance a Used Car – Getting it Right

The fact you’re reading this article probably means you want help on how to finance a used car purchase.

It would be nice to say that if you contact the “Free Money On Demand” company, they’ll immediately deliver a truckload of cash to your front door and charge you nothing for it. If only!

In reality you’re probably going to have to think a little about things and avoid rushing in – at least if you’re looking for the best deals possible.

Try to clarify your own financial position.

Before you get any loan from anyone, you will need to be able to explain your overall financial position. They’ll most likely need to know how much you’re earning, the nature of that income and what your monthly outgoings are.

They need this to try and understand how much you can realistically afford to pay back each month and from this they’ll know the maximum amount they could lend. You won’t help your case if to start with potential lenders see that you’re unclear about things as basic as how much you earn each month or how much you’re already paying out on things such as mortgage or rent. It won’t create a picture that you’re in control of your finances!

Deposits = confidence & lower cost.

Many lenders like to see that you are contributing some money to the purchase. The percentages may vary but asking for a big loan when you’ve only got 14.75 pounds to offer as a deposit won’t inspire confidence. There may be some zero deposit deals available but it’s worth remembering that these mean you’re borrowing more and therefore the repayments will be higher. In some cases ‘zero deposit’ interest rates may also be higher.

Keeping your feet on the ground.

Any professional and scrupulous lender will want to see that the value of the asset (car) bears some relationship to the reality of what you are trying to borrow and proposing to pay for it. Many lenders will have a comprehensive knowledge of vehicle values and while you think that 20-year-old rust-bucket is in fact a future antique and a snip at the price – they may not share your optimism.

Thinking about the options for financing.

If you have verifiable regular income and assuming you do not have a catastrophic credit history, you will probably find that there are many lenders around such as banks, building societies, finance companies etc. It may pay to avoid the temptation to take the first one offered just because it means you’ll get the car faster. You may get a much better lower-cost loan by shopping around or getting someone to shop around for you.

Recognising the complexities of car finance deals.

If you’re not completely comfortable with the complexities of interest rates, repayment periods and service charges, or if you have a history of credit problems, then you may want to think about using a specialist car finance service.

That’s because it’s not always easy to tell at a glance what the best offer is for your particular situation. There are specialist car finance websites that do offer a broad-spectrum knowledge of how to finance a used car and you may learn a lot from reading through their services and advice. More importantly, you could also save yourself a lot of money!

Financing a used car will for many be easy. How to finance a used car in the most cost-effective fashion may be more demanding and need a little preparation combined with expert help to find the right deal. Good luck:

Financing a Used Car

A great used car can end up costing a little bit more than someone is comfortable with paying for in cash, which in turn leads to the needing used car financing in order to help make the car more affordable. There are a few different things that you should be keeping in mind when you are looking for used car loans which will make the process much simpler, which will in turn result in a better used auto loan in the long term. Having something like just a single point of difference in an interest rate very well may not seem like a huge deal in the rush of signing the paperwork on your car, but that alone could very well mean a huge savings or a huge increase in the costs over the lifetime of the vehicle which makes it worth it to find yourself the best possible used car loan rates.

Before shopping for financing for used car, it is always best that you start by sitting down and figuring out exactly how much you are going to be able to afford. Potential buyers need to take into consideration that in addition to your monthly payments, you vehicle will also need to be insured, and the vehicle will also need gas as well as periodic maintenance. All of these different costs can and will add up, so it is critical to put them within your monthly budget in order to avoid any surprises or a loan that is more then you are able to handle.

While putting together your considerations for a loan, it will be of great help for you to use a used car loan calculator in order to give yourself an idea of how things such as the amount of a loan, the length of a loan, and the interest rate can change how your monthly payments are worked out as well as the total cost of this loan over its lifetime. As a general rule of thumb, loans that have shorter terms are more beneficial, because you will end up paying less in interest, and the lower the interest rate that you have, the less costly the used auto loan will end up being.

Once you are able to determine some sort of an optimal price range, you should then be able to begin approaching financial lenders for used car loans. Credit Unions are often a great source for used car financing, since they offer low interest rates to their members, but it pays for you to shop around to help give you a better idea of the rates offered by several financial lenders. You should always be fully aware that the quoted rates usually reflect an “ideal buyer” with a great credit score, and people that happen to have lower credit scores may be unable qualify for those rates. Rates can also change depending on how old the car is, which another thing to take into consideration.

It is also very possible for you to get used car financing online instead through financial lenders that are not locally based, even though the service on this used auto loans will be just as good. In order for you to avoid any negative impact on your credit scores, you should first shop around without actually applying for any loans, and ask only one or two financial lenders which appear to have good rates and terms for you on a used car loan.

One last thing that you should definitely try and avoid with used car financing is doing it through a car dealership. Dealers could have working relationships with local financial lenders, but these relationships will unfortunately often involve some sort of kickbacks to the dealers for sending loans to particular financial lenders, and the customer unfortunately will usually end up paying those kickbacks. It is better to get pre-approved for a car loan from a financial lender of your choice, rather than select a dealer to identify the particular car to buy.

Even if you happen to be in a position where you currently maintain not so great credit, there are a variety of different solutions out there that can benefit you. Not only will these bad credit solutions be capable of landing you in the vehicle that you desire, but it will also enable you to begin the road of credit recovery in order to get you back on the right track. Best of all these solutions are online based, and it is extremely simple for you to research the best interest rates and terms and conditions from a multitude of lenders so that you can be certain that you are getting the best possible solution for your own unique financial situation.

Financing Your Used Car

When selecting a lender to finance one’s car, one should conduct or perform some extensive research over the internet. This assists in finding the most suitable lender to obtain a loan. One may use search engines to locate the lenders by keying in their company names. The financing options vary depending on the type of vehicle. The financing options for brand new cars are different from those of used cars. One should acquire value for their money when financing their used vehicles. A car begins to depreciate the moment a person purchases it and commences to drive it. There are three main options that a person has when planning to finance their vehicle.

They include contract plans, used-car loans and hire purchase. Hire purchase is a traditional means, which aids in spreading the costs thus easing the payment process. When selecting hire purchase as a means of financing one’s used car, one should budget accordingly to accommodate the monthly fees that the seller may deduct until the agreed period is over. Hire purchase is the most popular, mainly because the initial deposit is quite low. Compared to contract plans and used-car loans, this means is cheaper in terms of the payable interest. One may also negotiate the interest rates with the seller in order to obtain the best financing deal.

Contract plans require the buyer to deposit some money as a way of securing the car for purchase. After paying the deposits, the seller deducts the agreed monthly installments from the buyers account. After completing the monthly payments, one has the option of maintaining the vehicle while under the sellers care, or one may make a balloon payment. When a buyer makes a balloon payment, it means that they obtain full ownership of the vehicle. Contract plans have lower monthly fees, as compared to the hire purchase method of financing one’s used car. When one fails to meet the monthly payments of both the contract plans and hire purchase means, it means that the seller reserves the right to repossess the vehicle. Therefore, people should organize themselves financially before purchasing a used car.

Alternatively, one may obtain a loan from their bank as a means of financing the used vehicle that one intends to purchase. The benefit of obtaining a car loan is that it secures the vehicle therefore, meaning that the seller cannot repossess the said vehicle. Bank car-loans have competitive rates and this ensures that their customers have various repayment options. They are also easy to manage and organize, in terms of finances and this makes it an efficient means of financing one’s vehicle. Once a person obtains a bank loan, they may fully purchase the car, by making balloon payments. The bank deducts money from their customers account depending on the agreed interest rates. The buyers may sell the car before completing the loan payments and accomplish something else with the money. When looking for a suitable lender to finance a used car, one should compare the rates and benefits before selecting a particular means.

Finance a Used Car With A Lien

To finance a used car with a lien is not that difficult and is a pretty common occurrence now days. This is because most people have a lien on their car when they go to sell it. Gone are the days that someone pays off their car and keeps it until it dies.

Let’s begin by explaining what a lien is…

A lien is a put on a piece of property, in this case a vehicle as assurance that the borrower will pay the debt in full. It is a form of security for the lender.

When anyone finances a car, new or used the bank places a lien on the vehicle until it is paid in full. This gives the lender the right to the title also. Once it is paid in full the lender releases the lien and the borrower owns the car outright.

Now you will become the holder of the title.

Buying a used car from someone who owns the car outright and is the holder of the title is definitely an easier choice but there are times when it simply isn’t possible.

So, if you have fallen in love with a vehicle that you simply must have but it still has a lien on it, let’s take a look at how to finance a used car with a lien.

If you’re buying from a private seller…

Never hand over cash to the private seller that still has a lien on his or her vehicle they are trying to sell. This is because you have no guarantee that the person will pay off the loan releasing the lien.

If they don’t pay off the lien…

You are out double; you have lost your money and you cannot legally own the car.

Begin by speaking with the person who is selling the car. Discuss which lending institution holds the lien on the car. Ask how much he owes on the balance of his loan.

You will want to know this information.

If the seller owes more that what the vehicle is worth you will want to know how the seller is going to pay the balance off.

Usually the seller is more than willing to share this information in order to sell the car more quickly.

Once the lien is paid off the lender will issue a separate release of lien on the car.

Once you have purchased the car you will want to get a bill of sale from the seller. This is not a step you can afford to miss because you will need this bill of sale for the next step.

Now take the lien release, bill of sale, proof of insurance as well as the title to the DMV (Department of Motor Vehicles) and then they will issue the title in your name with your bank as the lien holder. At this same time, the DMV will collect any taxes due for the vehicle.

So be sure to take your checkbook.

An easier way…

Purchasing a used vehicle through a reputable dealership with an auto consultant/auto broker may be the easiest route possible. This is because the dealer would have paid of any prior liens when they bought the vehicle from the previous owner.

This guarantees you that the car has no liens against it.

Saving You Money on Financing A Used Car

Without having the cash to purchase your used car, you may want to finance one with great rates and terms. Purchasing a new car may be a stretch for some people today. Buying a used car is a smart way to go if you have limited income.

When looking for a used car you will need to take some things into consideration. For example, the older the car is you may encounter some problems with constant repairs that can be very costly.

When looking to finance a used car, figure out what type of vehicle you need, such as a car, SUV,truck or a mini van. Ask yourself how long you will be keeping the car and what will you be using it for. Before signing any loan agreement make sure you understand all the fine print, such as interest rate, early pay-off penalties, etc.

After you decide what type of vehicle you want and you know how long you plan to keep it, you can start looking at the options you have for financing. Don’t just look at one lender do some comparison shopping.

To save the most money, paying for your car outright would be ideal. But lets come down to reality, most people cannot pay cash for a car. While looking for financing, consider putting a down payment on your car. This way you won’t have to finance so much for your car. If you finance your car and the taxes that go along with it will end up costing you more money in interest.

The less you borrow, the less you pay in the end. Shorter loan terms are a good way to save you extra interest charges. Loan terms 72-84 are not a good option to follow. It does not benefit you, just the lender. Longer term loans can cause you trouble as your car depreciates faster than you are paying it off. You will owe more for the car than it is worth.

Do not sign any documents that state you will have a pre-payment penalty if you pay your car off early. It may cost you a lot of money. The reason is that majority of loans are paid off before they mature, and its the lender that makes the profit.

There are options out there when it comes time for you to finance your vehicle. Do some shopping around and find the loan that fits your personal needs.

By the way, do you want to learn more about how I teach my clients to save money on their vehicles?

Best Ways To Finance A Used Car

n this article we will talk about the best ways to finance a used car. After a mortgage, financing a car is the second largest investment most people make. Shopping for a car loan is just as important as shopping for the car.

It is a known fact that new cars depreciate and drop in value like a rock, as soon as you drive them off the lot. Finding financing for a used car is a great way to save money and get more car for your money.

The interest rate you have to pay on a used-car, will depend on how old the car is and your credit history. You usually pay a little higher interest rate for used cars over a new car. You can finance a used car through the same financial lenders that supply financing for new car buyers, including credit unions, banks and car dealerships.

Know your credit score before you go shopping for car, to ensure that you are getting their financing terms and a good interest rate you. If your score is over 680, you should be able to get a good rate and terms.

Next do your homework. You want to research and think about the types of vehicles that you like and what appeal to you. Be careful you don’t get caught up in the excitement of buying a new car, and end up buying something you really don’t want.

Think practically. If you’re going to buy a vehicle for a long commute to work every day, you’ll want something with good gas mileage. Look for a vehicle that not only meets your practical purpose, but also satisfies your desire for a car that is comfortable and fun to drive.

Sources for Financing

Look at different sources for your financing. A lot of times a credit union will offer better rates and terms than your local bank. If you already have a current car loan with a lender, then by all means go back to that lender and see what type of terms they will offer you. It’s always a good idea to check online and see what going interest rates are, that way you will know if you’re getting a good rate or not.

Interest Rates

The interest rate on your loan, the amount of money you need down and your monthly payment are based on your credit history. If you have any blemishes on your credit report, make sure you have explanations and evidence to clear them up. If there’s something in your credit report that is derogatory and shouldn’t be there, then notify the credit bureau and have it removed before you go looking for a car.

Term

It is always recommended to go with a shorter term loan rather than extending the payments out over a longer period because you will pay more in interest. The other negative side of a long term loan is that the car will depreciate faster than what you are paying it off. This can leave you in a negative car loan where you could end up owing more on the car than what it is worth. If you are looking at purchasing a car and you need to extend the payments out over 48 months to be able to afford it, then look for a less expensive car.

Purchasing Or Financing A Used Car SUV or Truck? Here Are Some Techniques For Everyone

The purchase of a car or truck can be a sizeable purchase for anyone, financing a used car or truck is part of the challenge for many of us. It might cost a lot more money if you aren’t totally ready for the challenge connected with and also the specific job regarding buying of the vehicle. Here are a few excellent techniques to begin the process of purchasing your next car or truck whilst avoiding most of the frauds that happen in this industry.

Always bring a mechanic along when evaluating your next car or truck. A number of automobile dealerships are infamous with regard to reselling clunkers. If you can not have a technician to look at vehicles with you, at a minimum make sure that he can check out your final preference prior to buying the vehicle.

Set up a budget and stick to it when buying an automobile. It can be difficult to follow a reasonable spending plan when you are looking at a vehicle that you really desire, nevertheless, you’ll find nothing good happens from an impulse buy. Decide what you really are able to afford even before you start looking so you won’t hurt yourself financially… for anybody who is financing a used car, the financing is part of the research, and you’ll get a better deal if you’re a good negotiator.

Make sure you research the resell value of a car you’re considering purchasing. certain vehicles hold their value better so make sure that if you’d like to keep your vehicle for longer than 36 months, try to find a model that holds its value.

If you need to get that new car just when it moves off the assembly line, realize that you will probably shell out more for this “pleasure”. Cars and trucks are higher priced the day they come from the factory, and it’s easy to get a bargain with a brand new car or truck if they have been on a dealers lot for several long months.

When you are test-driving your car, be sure it really works with regards to your actual necessities. If you have little ones and are installing child car seats, bring them along to see precisely how they fit. For people with tools to carry for your job, make sure they can fit adequately within the bed or trunk. This will give you a good sense of how good the vehicle fits your way of life and requirements.

If You Are Financing A Used Car Or Truck – You’ll Need A Finance Package

See your bank to get pre-approved with a car loan package. This will save you a lot of time at your dealership, and can save money. By getting a loan at your bank, you are able to know your regular monthly interest fees, and often you will save on your entire payment. Don’t discount financing a used car from a dealer completely. Often the Financial Services department at a reputable dealer will help you obtain nearly as good, if not a much better bargain when compared to a bank, as they deal with all the banks, who want to compete for your business.

Don’t hold off until you are heading shopping for a car or truck to determine how you will go about financing a used car. After finding the vehicle you truly desire… emotions and thoughts often control us, and you might sign almost anything just to get out of there and go drive your brand-new car! You need to get through the details at the car dealership with a clear head so you get the deal you want and need.

Preparation is the key to buying or financing a used car, truck or a new SUV. The better prepared you are, the better deal you will walk away with.