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Financing Your Auto Purchase
There are a few things you can do before you make the trip to the dealer that will help you make better choices when financing your automobile.
Know your financial situation and what will comfortably fit within your monthly budget. If you are financing your purchase choose the shortest term finance contract your budget will comfortably allow. Shorter contract terms may help limit the total amount of interest you will pay when financing your car.
Know your credit score so that you will have a better idea of whether the interest rate you are quoted is fair based on your credit rating.
Use one of the many financing calculators available on the internet to help you determine how much different contract lengths and interest rates will affect your total payments. It will also help you determine the price range to shop in.
Compare annual percentage rates and financing terms from multiple finance sources such as a bank, finance company and credit union. Rates can vary widely depending on your financing source.
You have done your homework and you know what you can afford. Do not increase the length of your contract to make your monthly payment fit your budget. Stay with what your research revealed you can comfortably afford to pay off before the car reaches a negative value. If you do lengthen the contract you will pay more for the car in interest cost and insurance cost.
Take time to read the contract carefully before you sign. You are obligated once you have signed a contract. Get a copy and take it home overnight if you are feeling rushed or pressured to sign.
Use these tips and others you will find at non biased site such as the Federal Citizen Information Center to empower you to make the decisions that will benefit you most.