Finding the right car for your business is fun and exciting. Your new asset will no doubt provide you with the opportunity to grow your business and achieve the next level of success. But don’t overlook the important details. Getting the right car loan is just as important as getting the right car.
1. Always negotiate the price of the car
The total price of the car will, of course, determine how much your repayments are and how much interest you’ll pay in total. Negotiating with a car dealer can be difficult, but it’s worth it in the end. One way to do this is a reasonable offer that you’re happy with and stand firm on it. If you’re not in a hurry and continue to follow up with them, it’s likely that they’ll eventually meet your offer.
2. Don’t just get finance from the car dealer
Car dealers may experts on the cars that they sell, but that doesn’t mean that they’re experts in car finance. Usually, car dealers have fewer options for finance than banks and finance brokers. It may be more convenient to get finance through the dealership, but you’ll likely save money if you put the extra effort into getting the right car loan.
3. Keep the loan term short
A good way to reduce the total amount of interest that you pay is to take a shorter loan term. This will increase the amount that you repay each month, but it may be worth it if you can comfortably budget for this. Paying off a car loan in two years instead of five years could potentially save you thousands of dollars.
4. Only get the options you need
Car loans can have just as many optional extras as cars! And just like cars, you may not need all of them. Loan options such as early repayments and GAP insurance can be very useful, but each option can increase the total cost of your loan. Make sure you identify the options that are important to you and don’t let anyone up-sell you feature that you don’t need. It may be that you don’t need any extra features.
5. Don’t accept a high interest loan, even if you have bad credit
Your credit history will be the most important factor in determining the rate of interests that you pay. If you have good credit, you’ll be able to get an interest rate below 10%, but people with bad credit often accept car loans with interest rates as high as 24%! There are many things you can do make your loan application more attractive to a lender that can help to lower the interest rate of a bad credit car loan.
Following these steps can help you get a better deal on your car loan. Getting the right advice can also be a huge help when it comes to finding a car loan that suits your needs. Make sure you get car loan advice from a financial expert.