All About Interest Rates

What’s the most important number in any auto loan? No question, it’s the interest rate. A good interest rate means you won’t be overpaying for your vehicle or go up-side down on your auto loan. Bad loan rates can increase the price of your vehicle by thousands of dollars and even make monthly payments difficult. Don’t get stuck with a poor interest rate on your auto loan, find everything you need to know about rates here:

• Ask any lender and they’ll tell you that the number one factor that will affect your interest rates is your credit score. Consumers with bad credit scores almost always find themselves in bad auto loans. Those with a good score have more freedom to get the loan term they really want. Before applying for an auto loan, make sure you’ve kept a clean credit history for the past year and try your best to lower your debt to available credit ratio.
• While your interest rate is probably the most important aspect of taking out an auto loan, you must also consider the loan’s length. Obviously, the longer the life of your loan, the more you’ll be paying in interest over time. Getting a decent interest rate won’t be all that beneficial if you’re stuck paying the loan off for 72 months.
• Do you have a bad credit score but would still like to get a good interest rate on your auto loan? Believe it or not, it is possible. The best way to offset the effect of a poor credit score is to have a large down payment. By paying a lot for your vehicle up front, lenders will be more willing to give you favorable rates and terms. You’ll also be able to take out a smaller auto loan overall. However, you may still qualify for some bad credit auto loans if you cannot come up with a relatively large down payment for more traditional financing.
• Just like the adjustable rate mortgage in home loans, there are variable rate auto loans out there too. Unfortunately, like their home loan cousin, they tend to be undesirable. You might be able to get a good interest rate at first, but variable rate auto loans almost always increase significantly. The increasing rate can easily cost a borrower thousands of dollars extra, so avoid them if at all possible.
• Aside from pumping up your credit score and having a large down payment, the best way to get a good loan rate is to use Massachusetts Auto Loans! Using our simple service, we can match you up with the auto loan lenders that meet your needs. In minutes, we can have quotes from some of the top lenders available to you. We know how important your auto loan rate is and we’re confident that the lenders in our network can provide you with the rates you’re looking for!