Sort out your financing before entering a dealership
When it comes to buying a new or used car, there are a lot of steps you have to take, and one of the most important is getting approved for an affordable a car loan. Car financing can make anyone's head spin if they are not familiar with the process. Those who are gearing for that new car may not want to make their first stop at the dealership. In fact, it is recommended that individuals get all of their financing done before they even step foot in a dealership, and here are the reasons why.
Beneficial for negotiating price
First of all, a lot of the pressure is off of you now that you have a car loan in place. You are able to negotiate with the dealer to find the right car for you at a price that is satisfactory for both of you. There are a lot of factors that go into the monthly payment including the loan amount, loan term depending on how many years you have it for and the interest rate. When you have your financing worked out before going to the dealer, they are no games to be played and the dealer will not be able to sway you one way or another. They may even offer you a better deal to secure your sale, since you effectively have cash in hand.
Buyer's remorse is less likely
When it comes to buying a car, this is one feeling you do not want to have. Leaving the dealership with an uneasy feeling that you have to pay more in a car loan than expected can easily be avoided when you have a loan going into it. If you are unable to get a preapproved loan because your credit score is less than stellar, you may want to work on improving it before you buy a vehicle.
Dealers have a bad rap
Even though many have heard horror stories of dealers trying to get more money out of buyers or cornered them into bad financing deals that led to less-than-desirable situations such as yo-yo financing, dealers are not all bad. So, when the dealer starts rattling off a few deals that will go great with your car, you may want to think about them for a second before completely dismissing the idea. The financing offers and incentives may actually be desirable.