7 Tips for Getting Used Car Financing

Buying a used vehicle is the most economical way of getting a new set of wheels. But you’ll want to be just as smart about the financing as you were about the vehicle purchase. By following a handful of guidelines and working with your local dealership, buyers in Dublin, OH, can easily arrange car financing. 

1. Look Up Your Credit

Checking your credit score before you start shopping for a used vehicle will give you an idea of what type of interest rate you can expect to be offered. That will also help you begin to develop a budget for your vehicle purchase.

If you find that your credit score is low, you should be prepared to pay a higher interest rate on your vehicle financing. You also may be able to offset the impact of a low credit score by making a larger down payment or bringing on a co-signer.

2. Stick to Your Budget

Having a budget for your vehicle purchase, and sticking to it, is key. Purchasing a vehicle that fits into your budget ensures that you’ll be able to pay it off. And lenders will be more likely to offer you a low-interest rate if they are confident in your ability to handle the debt.

3. Make a Down Payment

There are various theories about how much buyers should put down on a used car. But probably the best rule of thumb is to put as much toward your down payment as you can comfortably commit to. The more you pay upfront, the less you’ll have to finance. And if you’re borrowing less, you’ll pay less in interest.

4. Keep the Term of Your Loan Short 

Vehicle financing can be arranged for varying lengths of time. Longer-term financing packages, which stretch the repayment period out over more years, are sometimes popular because they usually involve a lower monthly payment. But the longer it takes to repay your loan, the more you’ll end up paying in interest. Try to find a shorter-term loan that has a minimum monthly payment that fits into your budget.

5. Evaluate More Than One Offer

Consider a couple of different financing offers before accepting one. If you shop around, you’ll be able to find financing that carries a term and interest rate that suits your lifestyle and budget. The professionals at your local dealership can help line up various financing options for you and assist you in evaluating them.

6. Look at the APR

As you’re evaluating various financing offers, pay close attention to the APR on each one. The APR, or the annual percentage rate, is the interest rate you’ll pay on the funds you borrow. It’s a key figure, and the higher the APR is, the more you’ll end up paying.

7. Don’t Finance Your Fees

In addition to the vehicle purchase price, you’ll also pay sales tax and fees on your car or truck. If you fold these fees into your financing package, you’ll end up paying interest on them. Try to pay for these extra costs in cash.

Arranging to finance a used vehicle is easy, and your local dealer can help. Go to Twins Auto of Dublin and pick out your used vehicle today!

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