If you're ready to buy a car, it's possible you've given more thought more to the colors and options than you have about how you'll pay for it. We understand – car shopping can be fun! But for some, getting a car loan is something they'd prefer to avoid.
At We Drive, we'd like to change that. Here are a few good reasons to get excited about getting a car loan:
Know how much you can spend. There's nothing worse than getting amped about your next car only to find out you can't get approved for a loan to buy it. By getting pre-approved, you'll know how much you have to spend. You can then keep your car search to what you can afford, and avoid looking at what you can't.
Alternatively, if you have your heart set on a specific vehicle but it's outside of your price range, you'll know how much you need to save for a down payment. Try to put aside a few dollars each payday or sock away your tax return or bonus in a savings account. You may have to temporarily give up some luxuries to reach your down payment goal, but it's worth it if you'll get the car you want.
Negotiate like a cash buyer. Want to have the upper hand when it's time to negotiate the price of a car? Tell the dealer you already have your loan secured. Dealers can play with the price of the vehicle if they think they'll make money on financing. By arranging your financing separately, you'll negotiate only the price of the car and not worry about missing hidden financing fees or interest charges.
Choose a loan that fits your budget. Although you may qualify for a large loan based on your income or credit history, you might not be comfortable borrowing that much. Building a little breathing room in your budget is a good idea because it allows you to save – for example, for a home, an emergency fund, a big vacation or a wedding. You can use this auto payment calculator and auto affordability calculator to find a loan and payment that are comfortable for you.
Get the best interest rate. This applies especially if you have not bought a car in a while. Interest rates can vary widely. By tackling the financing separately from the car purchase, you can comparison shop and get the best rate for your credit score and the length of the loan (commonly called the term; typically, shorter terms have lower rates). The better your credit, the more financing options you'll have available, so it pays to do your homework.
Buying a car can be much more fun when you are ready every step of the way. Plus, staying in control of the process will give you the confidence to know you are making the best decisions for you and your family. Not sure where to begin? We recommend starting your South Florida car-buying journey at We Drive. First, we'll pre-approve you for financing. If you like, we can also help you find the car of your dreams. Prefer to search on your own? That's OK too. Take the first step with We Drive!