Getting an auto loan can be stressful and cost you more than you ever thought it would. At Idaho Central Credit Union we are here to help members achieve financial success and getting the right auto loan is critical in doing that.
Here are 5 tips for getting an auto loan that can help you get the right auto loan for you and help you drive away with the car of your dreams.
- Understand Your Credit Score
- Understanding what your credit score is and how it affects the way you obtain a loan is important. There are ways to build your credit before you obtain a loan to help you get the best rate possible. There are free tools out there to help you get your FICO credit score or you can request your credit score once a year for free from Experian, TransUnion and Equifax. At ICCU we offer Credit Builder Visas and Loans to help you build your credit if your score is lower than you would like or you haven’t built one yet.
- Learn More About Different Lenders
- There are many different options for obtaining an auto loan. You can get loans through credit unions, banks, online lenders, and other private lenders, but a great option is using a credit union. Idaho Central Credit Union provides great auto loan products to fit everyone’s needs. We also work very closely with over a 150 dealers in Idaho that offer our auto loan products.
- Choose The Shortest Loan You Can Afford
- When buying a car it is tempting to lower your monthly payment (we will talk about this more in tip 5). Over the years cars have gradually become more expensive and loans are being dragged out further and further. When shopping for the right loan pick the shortest term you can afford. This will not only make the vehicle your asset sooner, but you will save money by getting a lower rate and paying less interest over time.
- Get Preapproved Before You Visit The Dealer
- By getting preapproved before you go to a dealer you can understand the auto loan buying process more fully, especially if this is your first time buying a vehicle. Our Financial Service Officers at Idaho Central Credit Union can be a great resource of information to help walk you through the process. That way you are prepared when you visit the dealer.
- Don’t Shop by Monthly Payments
- This is sometimes the only thing people think about when buying a new car. There is a false sense of security when we shop for cars like this. When shopping for a car you should look at it in three transactions (trading in your previous vehicle, price of the new vehicle and financing) if you are trading in your last car. If you aren’t careful they can sell you a more expensive vehicle because they lengthen out the term of the loan to fit that monthly payment. Remember to shop for the loan amount and not the monthly payment!
Buying a car can be stressful, but there are great resources around to make this process easy and even fun. If you are looking to buy a vehicle visit your local Idaho Central Credit Union branch or ask your dealer about financing with Idaho Central Credit Union.