Thinking about getting a car loan? Do you feel that it is a daunting process? Well then, fear no more! There are things that you can do to improve your chances of getting a car loan at a good rate.
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- Have a stable employment record and be employed when you apply
Think about it, if you were a lender, would you lend to a person who hops from job to job or one who has a good record of employment with only a handful of employer’s overtime? The answer is obviously in favor of the person with a stable job. So if you have a job right now, do your best to keep it. Secondly, it’s pretty obvious that applying for a loan when you’re unemployed is probably not a very good idea, unless you have a wide list of assets. And even then being unemployed will stand against you.
- Be on the job for at least six months
Along with stable employment lenders also like it when people have been on a job for at least 6 months and a year is preferable. So if you’ve only been on a job for a short while, you may want to wait a bit to apply.
- Cut the debt
You can’t borrow indefinitely and expect to get a loan at a good rate. No one would want to lend to a person with big debt loads. So if you can afford it consider cutting some of your debt load by paying off those loans. You should think about paying off the loans that have the highest interest rate. They’re probably costing you a lot of money.
- Have a stable living situation
Lenders prefer borrowers who have lived in the same place for at least 6 months. And like employment they prefer at least a year. If you just moved you may want to hold off applying for a car loan for at least 6 months.
- A mortgage can help you with your auto loan
Having a record of paying your mortgage on time can help you get a loan for your car. That is because lenders are very likely to lend people money who make their payments on time and if you have a good record of paying your mortgage payments it indicates that you’ll also be good at paying your car payments on time as well.
- Close your unused credit and charge accounts
Unused open credit charge accounts actually work against you even if they’re completely cleared off. So close them if you have them. However, don’t close your oldest credit card or other type of charge account as it tells the lenders how long you have had an established credit. And the longer it has been established the better it is for you.
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- A car loan can help you get a car loan
Having a car loan that has a good record of payment is also a gold star with lenders. It can help you get another car loan. So make your payments on time. That will help you get car loan in the future.
- Pick the car
After you’ve received a pre-approval from lenders you’re set to look for a car. Be sure to check under the hood and inside the car for any problems. However, minor problems can be fixed. For example if you really like a car but its tires seem to be problematic then you can have them replaced. You can get new tyres online from Tyre Shopper which is a top rated tire retail store online.