Know About How To Get A Fair Financing Rate On A Used Car

Have you ever made an expensive purchase and within days or even hours you had a bad case of buyers remorse? Back in 2002 after driving the same car for over ten years I decided it was time to get a new vehicle. Well, I went to the local Chevy Dealership and in less than two days walked away with a 2000 Chevy Silverado extended cab pick up truck. I had never purchased a car by myself and from the very beginning the salesman knew he had a fish on the hook. It was obvious that I was clueless when it came to used car financing.

My credit was only average and GM financing convinced me that 14% was as good as I was going to get. What an ignorant sap! Well, a few years later my wife needed a new car and this time I was going to do my homework. After doing some research on and offline I felt confident enough to at least go looking for a nice used car. The following are just a few ideas that saved us some cash once we found ourselves in the little glassed in finance office at the dealership.

* Stay away from extended service contracts on used vehicles. I am not saying that the dealership doesn’t honor extended service contracts however, they are not required to. The dealership will push this on you simply because it is 100% profit for the dealership.

* Make a down payment of 20% on the vehicle. I know that in our, “I want it NOW for nothing fast food culture” this may seem crazy but it will almost certainly give you a better shot at getting a better financing rate on your used car purchase. It will also shorten the life of the loan.

* Always check several lending options before you sign on the dotted line. Find out what interest rate your local bank or credit union will give you. It is also just as easy to apply for financing online. Never just settle for what the dealership tells you. Remember that the dealership is working with a lender themselves. If the lender approves your loan for 6.5% the dealership can tell you that you were approved at 8.5% and pocket the 2% difference.

* Get a credit check before you begin shopping around. It is important to know what they will know.

Getting a fair financing rate on a used car takes doing your homework. You should never rush into buying a used car. If your looking for more help with used vehicle financing click the link above. You will also be able to get a free credit report.