I’ve seen recent college graduates making car loan payments that are so big their bosses couldn’t afford those cars.The true cost of an auto loan isn’t just the monthly payment. It’s also the interest you pay. The interest grows, of course, over time. The longer your loan, the more you pay. I recently was shocked to learn that some people are stretching car loans out for 80 months or 96 months. Paying for a car over eight years? That’s a mini-mortgage.

If you are stuck in an expensive car loan, you can get out of it.

Refinancing car loans has become very easy to do. There’s plenty of competition, and consumers can find some good deals. The interest rates I found on refinanced auto loans were comparable to, and in some cases lower than, new car loans.

But there’s a bit of a trick to this trade. That is, it doesn’t work for all borrowers. And a refinanced auto loan might be a big money-saver in the long run, but those monthly payments won’t drop dramatically.

It all starts with the deal you make when you buy a car. Many people don’t do this well.

“We find that people get disoriented by the new car smell and make a really silly financial decision,” said Allan M. Prindle, president and chief executive officer of Power Financial Credit Union.

They don’t shop around. They don’t look beyond the monthly payment. They get sold something, rather than select the best loan. (more…)

When you refinance your car loan rate, your new loan deal can have all the benefits that you ever desired to obtain. If your current car loan is giving you sleepless nights and making you cash poor then refinancing can be your knight in shining armor.   Refinancing means acquiring a new loan to pay off an existing loan.

The question arises that why would anyone take the trouble of going through the whole process again when at the end of the day it simply means remaining still under debt. The answer is because refinancing car loans reduces your total debt. So in the long run, you pay less than what you would pay on your current loan. Whatever money is saved in the whole process becomes your savings that you can use in clearing other dues or for investment purposes.

Generally people resist from refinancing because either they are not knowledgeable about the whole thing or they fear going through the routine loan sanction procedure once again. They should just imagine how much relief they would get when they have to pay lower installments at probably a lesser refinance car loan rate. (more…)

Whether interest rates are high or low or it’s the end of a model year with lots of incentives, motorcycle buyers tend to make the same mistakes when shopping for a motorcycle loan. Here are four common mistakes motorcycle buyers make with motorcycle loans.

Shopping for a motorcycle before shopping for a motorcycle loan. Many motorcycle buyers enter the showroom looking for a motorcycle before they determine how much money a motorcycle lender is willing to loan to them for the purchase of a motorcycle. There is no need to shop for a $20,000 Harley Davidson motorcycle, if a lender is only willing to provide a loan amount of $10,000.

Additionally, once motorcycle buyers enter the showroom slick salespeople often pressure them into motorcycle loans with much higher internet rates than they could have gotten had they shopped for a motorcycle loan at a bank, credit union or online. Salespeople do not like motorcycle buyers to leave the dealership to get a motorcycle loan. In the salespersons mind this only increases the chance of loosing a sale and commission. Therefore, salespeople frequently try for a quick sale which normally results in pushing motorcycle buyers to get motorcycle financing at the dealership.

The bottom-line is that it is always best to shop for a motorcycle loan before entering the showroom.

Diving into the unknown motorcycle loan. Motorcycle buyers often jump into motorcycle loans that they do not completely understand or may not be the best alternative for them. For instance, in today’s age manufacturers frequently run credit card motorcycle loan promotions on their private-label credit cards. But these promotions typically offer a low interest rate for a short term like 12 or 24 months and have a much higher interest rate after the short promotional term. On a credit card promotion if motorcycle buyers can not afford to pay off the loan during the short promotion period, then they are typically better finding a lender offering an installment motorcycle loan for a longer term. (more…)

“While just about everyone knows about the pre-approval process for home mortgage loans, fewer know that pre-approval can also be used when purchasing an automobile. The process works in much the same way, with the lender reviewing the borrower’s credit history and credit score, and coming up with an amount that can be borrowed, and the associated monthly payment.

Knowing how much you can afford to pay for a car certainly makes the process of car shopping a lot easier. While it might be nice to shop for a Ferrari, if all you can afford is a Volkswagen you would be well advised to focus your shopping in that direction.

Being certain about your financing options will also aid in the negotiating process for the car. Those car dealers who know that you are truly able to afford the car you are looking at will often be more willing to work with you, and they may be more willing to lower the price in order to make the sale. (more…)

An auto loan is a good way for individuals with bad credit to make a fresh start and re-establish a positive credit history. A range of factors contributes to a low credit score. Yet, you have the ability to change your current credit standing. For some, improving credit may be simple. Their situation may simply require paying past due bills and settling collection accounts. On the other hand, if a bankruptcy or repossession damaged your credit score, consider obtaining an automobile loan to improve rating.

Get Pre-Approved for an Auto Loan

Prior to beginning your search for a new or used vehicle, it may help if you get pre-approved for an auto loan. Accepting dealership financing with bad credit may not be the wisest choice. Most dealerships offer financing to individuals with poor credit. However, dealerships do not specialize in bad credit loans, thus they will not offer the best rate.

To assure getting a fair interest rate, secure your own private financing before negotiating with a dealership. Getting pre-approved for an auto loan is easy. Simply complete an online auto loan application. The lender will review your credit and remit a quote that includes your approval amount. This is ideal for a speedy car buying experience, and a great way to avoid dealership scams. (more…)

Owning a vehicle, be it any type including a car is not at all an impediment even as you are labeled as bad credit in the loan market. Bad credit is no longer seen as a sin committed by you and is simply a financial mistake that can be corrected in due course of the time and lenders know it.

They look your case very sympathetically and give you the loan. Online bad credit auto financing is one such way of sourcing finance for owning a vehicle of your choice.

Online bad credit auto financing is called so because the finance is provided to you by the online lenders. They have showcased their bad credit auto financing products on individual websites. You can access their loan conditions easily on internet. These lenders are expert on offering finance to people labeled as bad credit. They can listen to the case of such borrowers sympathetically and can ease the conditions for the loan. One can say that these are online bad credit auto financing lenders who specialize in a loan offer to bad credit people. Bad credit does not come in the way of availing online bad credit auto financing because usually the lenders secure the loan through a property of the borrower. He can recover the loan by selling the property in case of payment default by the borrower.

For availing the loan one should apply online. Every lender has own online application format in which basic information like loan amount, repayment duration, purpose of the loan, type of the vehicle and personal details are filled and immediately dispatched to the lender on click of the mouse. The loan approval comes fast after the information is verified. (more…)

Q. What advantage is there to applying for a direct auto loan online? A. The biggest advantage of applying through an online lender is that the online auto loan application and loan processing usually gives you the opportunity to get the best rate, and allows you to do it in the privacy of your own home. Online auto lenders will inform you in a matter of minutes whether or not you have been approved for a loan.

A. What are basic criteria to apply for auto financing?

Q. You must be at least 18 years old. Your monthly income from one source of employment and other income should be a minimum of $2,000 for a direct auto loan, but can be significantly less when using indirect financing through an auto dealer. You need good residence and employment history showing of at least two years at the same location.

Q. What is the difference between direct and indirect auto financing?

A. Direct financing is a cash voucher or draft approval from financial institution for buying at a dealer of your choice. Indirect auto loan means you get financing from a dealer. (more…)

If you are thinking of buying a used car then the internet can be a very useful resource to you. While you can get the car of your dreams and there are many reliable dealers out there, there are also many factors that you have to take into consideration when it comes to making the choice of not only the right car for your needs but also the right place to buy. The choices when it comes to buying your car include buying from a private dealer, going to a second hand car dealer or looking through the many online sites that offer used cars. Of course if you choose to look online for your used car then this gives you the biggest scope and choices.

There are many sites which deal specifically in selling second hand cars, here you can select the area in which you want to confine your search, either locally or countrywide depending on how far you wish to travel.

The beauty of looking online for your used car is that all websites selling cars include photos; this of course can give you a very good idea of the condition of the car as most include more than one photo. However while this is a great starting point it isn’t where it ends, there are many other factors to take into account other than the colour of the car. (more…)