Whether you have good credit or bad credit, the steps for buying a used car or a new vehicle are similar. To be fair, most people have no idea what their credit rating is. Can you ballpark what yours? Is it 550? 850? What do those numbers even mean? Even if you have good credit, it’s not necessarily a hall pass to waltz into the dealership and expect the salesperson to give in to your demands. Credit is a finicky little thing. But you can stand to benefit regardless of your credit situation, by doing even just a little in-depth research. We are going to help you find that perfect vehicle for the perfect price.
Keep Your Credit Score Up
Many factors determine your credit score, and they all come from what's reported on your credit report. Three primary contributing factors are payment history, amounts owed, and length of credit history. Having a good credit report expands your options for getting an auto loan. Even though you have several options, how much will adding a car loan to your credit report impact your credit score? You want to keep your score up, making it easy to get approved for other loans in the future.
Know the Car You Want
History will suggest that buying a new car off the dealership car lot always has the lowest interest rates, especially when you have an excellent credit score. The kicker here, is that those new car dealerships normally just bake that added cost from the low interest rate, into the total price of the car. Whereas certified pre-owned vehicles typically come with higher interest rates on the car loan off the bat, which can lead to larger monthly payments, but a much lower total cost of ownership. Part of the buying process is knowing what type of vehicle you want. Car shopping can be overwhelming with the number of options available. Now we have to not only wrap our heads around those traditional car dealerships, but also the option of a 100% online car shopping experience at places like FFUN Cars. So do your research and narrow it down. If you are financially mindful, you won't want to pay for all those extras you don't need. Vehicles produced and sold in high volumes open the door for more negotiating power. They aren't considered rare, and salespeople want to push them through the sale and work with car buyers and lenders to present excellent loan terms to seal the deal. The beauty of technology is that information is (literally) at your fingertips. Don't be suckered by the cheesy salesperson on the sleazy used vehicle car lot. Know everything about the car(s) you are considering so you can beat the car salesperson at their own game. Remember, the amounts you owe are reported to your credit report, so knocking the purchase price down helps keep your credit score high.
Know Before You Go
If you have good credit, you probably already know you do, but if you don't, find out. The last thing you want is sitting in the finance manager's office, not knowing where you sit on the scale. If you know you have a good credit score, let them know because they won't waste your time trying to "sell" you on a "good loan rate." Nobody wants to feel like an idiot, certainly not automotive people, so look them in the eyes and say, "I know I have good credit, don't try and pull a fast one over my head." Well, maybe not in those exact words, but you get the gist. When a car buyer has poor credit, at times they can be at the mercy of the dealership and lose negotiating power on both the total price of the car and the interest rate. This can lead to a bit of desperation that leads to high car payments stretched over a long period. By doing your research, you will know your credit score, the best price for the car purchase you are considering, and potential loan terms, including your monthly or bi-weekly payments, whatever you choose. When determining your monthly budget, remember to factor in car insurance costs and other costs associated with owning a vehicle (gas isn’t cheap these days). According to nerdwallet, ideally your totally monthly auto expenses shouldn’t be more than 20% of your monthly take home pay. As you can see, there is no reason not to know what kind of auto loan you qualify for ahead of time. You can speak to your bank or credit union to get approved, which won't be an issue if you have excellent credit. Or you can go the easier way without leaving your house and qualify for a car loan fully online with FFUN Cars’ fancy @$$ technology that takes only two minutes without any impact to your incredible credit score.
Car Buying Goals
Sure, you need a car, and there are lots out there. See for yourself by browsing our massive inventory selection. But we all have ideas and goals when going through the car buying process. At the top of your list should be, getting the best car at the best price, with a low-interest rate and low monthly payments. In addition to having great credit, keep your monthly payments low by adding a down payment to your new vehicle purchase and trading in your current vehicle. NPR says your car payment itself should be between 10 and 15% of your pay. You can trade-in your vehicle at the dealership or see what we'll offer you. Guess what? Getting a fair market value rate on your current vehicle is also available entirely online through (you guessed it) FFUN Cars.
Always Remember
Whether you have good credit or bad credit, there are things to ensure you do when buying a car. It doesn't matter if you are buying your next vehicle from a private seller or a dealership, you'll always want to see a vehicle history report, and you can easily access this by locating the vehicle identification number (VIN) on the front windshield and doing a quick search. Or, make it easy for yourself and buy from FFUN Cars, where every vehicle comes with a free CARFAX report. Never buy a car without taking it for a test drive. If you are buying from a private party and they won't let you take it for a spin, don't walk away; run. In addition to taking it for a test drive, verify there aren't any liens against the vehicle. The last thing you want is to buy a car and then have it repossessed because the previous owners owed money on it and stopped paying the car loan. When determining how much you can afford, don't calculate your payments based on just the sticker price; consider the total purchase price, including sales taxes and interest rates. Buying a car with good credit is always the ideal way to go. If your credit rating could use some improvement and you aren't in a rush to get a new car, wait, and take the time to build your credit, enabling you to get the best rate. Either way, let’s chat about your options.
