November 2009 ~ Managing a Car Loan

Monday, November 30, 2009

How to Finance a Salvage Title Vehicle

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A salvage title -- referred to as a "rebuilt" title in some states -- indicates that a vehicle was wrecked, totaled out by the previous owner's insurance company and subsequently rebuilt. As a rule, banks are hesitant to finance vehicles that carry salvage titles. A salvage title decreases a vehicle's value. In the event you stop paying your auto loan and the bank has to repossess the car, the fact that the car has a salvage title could make recovering the defaulted loan balance difficult -- if not impossible -- for the bank. Although locating financing for a vehicle with a salvage title may require a bit more work than if the car boasted a clear title, some lenders will provide financing for rebuilt cars.

Instructions

Visit your own bank first and talk to a loan officer about financing a vehicle with a salvage title. If you're a longstanding customer with a good history of repaying loans and credit cards on time, your bank may make an exception for you and provide financing for a vehicle with a salvage title.

Call around to other banks and credit unions in the area if your own bank will not work with you. Ask each customer service representative you speak with about that financial institution's guidelines for financing vehicles with salvage titles. While most banks and credit unions will not finance a salvage car, some will.

Offer alternate collateral for your auto loan. Most banks' hesitancy stems from their inability to recover losses if you default on the auto loan. Providing the bank with collateral other than just the car, such as stocks or real estate, lowers the lender's risk -- making an auto loan on a car with a salvage title a real possibility.

Ask the dealership where you plan to purchase the car for help securing financing. Many car dealerships have in-house financing departments and can help you locate a lender willing to work with you. Even if the dealership does not typically finance cars with salvage titles, it may make an exception for you in order to make the sale.

Take out a private auto loan from a friend or family member. Friends and family are generally less concerned with a vehicle's value than commercial lenders. If your loved ones trust that you will repay the loan, the fact that the car carries a salvage title isn't likely to matter.

How to Sell a Car Wholesale

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Selling a car for the wholesale price is often a quick way for the vehicle owner to find a buyer. The seller must first determine the wholesale price of the car to know how much to ask for the vehicle. Once the seller sets the asking price, there are a number of ways to find a buyer for the car.

Check online to find the wholesale price of your car by using a search engine to find a website that has used car valuations. Once you locate a website, look for your vehicle in the used car section. Type your car's mileage and any extras or options into the input fields so you get an accurate valuation report. Generate the report and find the "Trade-in" value. The "Trade-in" value is also the wholesale price that you can ask a buyer for when you try and sell your car.

If you are going to buy another vehicle, one of the easiest ways to sell your current car for wholesale is by trading it in at a car dealership. Depending on the demand for the car that you are buying, a dealer may offer to purchase your old car for an amount that is higher than the "Trade-in" price on the valuation report. If the dealer offers less than the "Trade-in" price, show him the valuation report and use that to help you get the wholesale price for your car.

Many used car lots are run by a private owner who will buy vehicles for wholesale and then sell them on the used car lot. Drive your car to a used car lot in your area and ask to speak with the owner. Let the owner test drive and inspect your car. Negotiate the sales price with the owner and do not sell your car for less than the wholesale value.

Selling a vehicle at an auto auction is an option that may be an unknown for many car owners. If the car is in good condition, once the auction starts the bidders may drive up the price to an amount that is higher than the wholesale value. Contact an auto auction in your area to find out what you need to do to put your car on the auction block.

Online and print advertisements are common methods that car owners use to sell a vehicle for wholesale. To list your car online, use a search engine to find a website that sells used cars. Contact a representative of the website and find out the cost for listing your car for sale. Place an ad if you want to try to sell your car online. List your car for sale in the classified section of your local newspaper as well if you want to advertise locally.

Can You Get an Auto Loan If Your Only Income Is Unemployment and Workers Comp?

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When you apply for an automobile loan, your lender evaluates the likelihood of you repaying the debt. Lender's lose money if you default on a debt so most lenders check your past credit history and current income levels before extending credit to you. Few lenders approve loans based on unemployment income but you may qualify for a loan if you receive worker's compensation payments.

When you submit a loan application, your lender checks your credit report to find out about your existing loan obligations and your monthly debt payments. Your lender also typically reviews your last two year's of tax returns and your most recent pay slips. By dividing your monthly debt payments into your current monthly income, your lender can determine your debt-to-income level. Most lenders only agree to extend you credit if your DTI remains below 35 percent although some lenders allow you to borrow with a DTI ratio of up to 50 percent.

As of 2011, unemployment benefits in the United States can last for up to 99 weeks. Therefore, unemployment benefits are a temporary source of income. Typically, you can only qualify for a car loan or other types of credit if you have an open-ended income source or a two year history of steady income from self-employment. Car loans normally have terms that last for between two and six years. Therefore, your 99 weeks of unemployment benefits will end long before you have paid off your car loan. Furthermore, a variety of different factors, such as cashing in a 401k early, could cause your state government to stop your unemployment benefits even earlier than anticipated.

Worker's compensation comes in a variety of different guises and you may qualify for some type of compensation under state or federal laws. You cannot get a car loan based on a one-off settlement since you need to have recurring income in order to qualify for a loan. Furthermore, you cannot get a car loan based on short-term compensation payments that expire after a few months. However, some compensation plans include lifetime income payments in which case you can use that income to qualify for a car loan.

Some lenders offer high interest rate loans that people with poor credit can qualify for. These loans are often "stated income loans." This means you verbally provide your lender with information about your income levels but you do not have to provide supporting documentation. Therefore, you could count your unemployment benefit or short-term worker's compensation payments as stated income when you apply for the loan. However, once approved you have to contend with high payments caused by the high interest rates. Once your unemployment ends, your lender can repossess your car if you can no longer afford to make the payments. Therefore, stated income loans often provide short-term benefits but can cause long-term problems.

Can I Sell a Car Privately if I Still Owe a Balance?

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If you still owe money on your vehicle but want to sell it, expect to pay off your loan to release the vehicle's lien. Many states require a lien release to transfer ownership. You may pay your loan balance using the sales payment; plan ahead by learning your lender's payoff and lien release procedures so you can better communicate with potential buyers.

Before you sell your car, obtain your loan payoff amount from your lender. To release the vehicle's title or obtain a lien release (depending on your state), you must pay your full loan balance. If you haven't found a buyer yet, ask also for your loan's per diem amount, which is the cost of interest added to your loan daily. Ask a lending representative about the loan pay off process, such as where or how to submit your payoff and how long it takes to receive a title or lien release. A title might take several weeks to arrive.

Use Internet appraisal guides to determine the private sale value of your vehicle, such as the Kelley Blue Book website or Edmunds.com. If you can sell your car for more than you owe toward your loan, you may keep the profit from your sale. If your car is worth less than you owe, plan to pay the difference between the car's sales price and your loan payoff amount. Secure your funds and budget accordingly before you sell your car. This way, you'll be prepared to satisfy your loan quickly.

You don't necessarily have to advertise that your vehicle has a lien when listing your car for sale. You should, however, let potential buyers know that you're using the sales profit to satisfy your loan, which isn't uncommon. Some buyers might want to purchase a car immediately, without having to wait for paperwork. Communicate with your buyer by explaining the payoff process and how long it should take before you receive the title or lien release to complete the sale.

Involve your seller in the loan payoff process, if possible. Your buyer might feel uncomfortable paying thousands of dollars without a title or lien release in return. If your loan provider is local, complete the transaction together at your bank or credit union. If the lender isn't local, allow your buyer to make payment directly to the lender instead of you. Add a note to your account allowing the buyer to discuss your loan payoff with the lender. If you owe more than the vehicle is worth, pay your portion of the loan payoff before your buyer. This way, the buyer's payment satisfies the loan. The transaction might seem questionable if his payment still leaves a balance.

Auto Loan Tips: How to Buy a Car With Bad Credit

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If you have bad credit, it can affect your ability to obtain all kinds of credit including a home mortgage, credit cards and a car loan. Poor credit may signify your inability to repay a loan to a lender, and it makes you appear to be a greater credit risk. Even with this obstacle, if you are in the market for a new car, you may be able to get a car loan even with bad credit.

Assessing your credit situation is an important first step. ConsumerAffairs.com suggests you order a copy of your credit report from each of the three major credit bureaus: TransUnion, Equifax and Experian. Review your credit scores to see where you stand. Generally, anything over 700 is considered good credit eligible for the best rates. If your score is under 500, you may need to spend some time improving your credit before a lender will lend to you. If you notice any inaccuracies on your credit report that may be dragging your scores down, send a certified letter to each of the reporting bureaus to request correction. Request an updated report reflecting the corrections.

Even if you do have poor credit, many lenders and automotive financing companies specialize in loans for consumers with damaged credit. Companies like CarsDirect.com specialize in connecting consumers with lenders that offer financing for both used and new cars even if you have had a history of late payments, judgments, liens and even bankruptcy. You may also be able to obtain a loan even with poor credit from your local bank or credit union. You should be aware, however, that you will likely be required to pay a higher interest rate on the loan due to your poor credit scores. Some lenders may also charge additional fees on the loan to help cover their costs in case you default.

Once you obtain a car loan, you may be eligible to improve your situation down the road. Make all of your payments on time for at least six to 12 months. After you have established a solid history of payments, you can apply for an auto loan refinance. A refinance may give you the opportunity to lower your interest rates and thereby lower your monthly payments to pay off the loan sooner. A refinance may also allow you to lower your payments further by extending the terms of your loan and stretching the payments out over a longer period.

How to Calculate a Gap Insurance Refund

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Some people elect to purchase gap insurance when financing an automobile. If a vehicle is wrecked and totaled, the amount the insurance company will pay won't always be the amount that is owed on the auto loan. Gap insurance covers the difference between how much you owe on the vehicle and how much it is worth should be totaled. It provides extra coverage for the "gap" that occurs when a vehicle is not worth the amount owed to the finance company. If the vehicle is sold or paid off early, and you paid gap insurance out of pocket, you may be able to collect a refund of the unused premium. Calculating a premium refund is the same as it is for any insurance premium refund.

Instructions

Locate the gap insurance premium amount on the financing contract.

Locate the term of the loan. This is the length of time for financing the vehicle (i.e., 60 months).

Subtract the number of months remaining on the financing contract by the number of months for which the financing was in place. Example: If the vehicle was financed for 60 months but paid in full in 40 months, 20 months is the number.

Divide the gap-insurance premium by the number of months the vehicle was financed for. This will indicate how much the gap-insurance premium costs per month.

Multiply the monthly gap-insurance premium by the number of months remaining on the financing contract. This amount will be the unused gap premium available for refund.

Finance New Vs. Used Car

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Interest rates are slightly higher for used car loans, although you're likely to finance for less money because of the cost difference between a new and used vehicle. Term options for your loan may also be affected depending on the year and mileage of the car you want to finance.

You may find special interest rate offers if pursuing a new car purchase. Check the websites of manufacturers and individual dealerships to find out if offers exist. Interest rates offered by manufacturers for new cars are lower than you can find on your own, such as a zero-percent interest rate or a 3.9-percent offer for 72 months. Rate offers are usually optional; you may choose low-rate financing or cash incentives, which are immediate discounts from the vehicle's sticker price. Use an auto loan calculator to see which option saves you the most money.

Used car rate offers are far and few between, but some may exist. Call dealerships in your area to find out if any offer low-rate used car financing. You are not likely to find a zero-percent option, but may obtain slightly lower rates than comparable lenders. You can find the rates for new or used cars online by visiting the websites of different auto loan providers. Used car rates are slightly higher than new car offers.

Your term options may be affected by the vehicle and lender you choose. If you choose to purchase an older vehicle with high mileage, expect to obtain an approval for a shorter term, as the bank must consider the vehicle's depreciation and loan amount. You may also pursue a longer loan term if purchasing a new car if price restrictions exist. For example, you may be able to pursue an 84-month loan as long as you finance at least $35,000. Interest rates increase beyond 60-month loan terms.

Used car lease options rarely exist. If you do find the option available, compare the cost of financing the vehicle to leasing it and you'll likely find a lease is not financially beneficial. Low payment lease deals exist on many new car models. Leasing requires you to pay only for the car's depreciation over the contract term instead of the vehicle's total value, so payments are cheaper than financing. Just like rate incentives or rebates, lease offers are also listed on the manufacturer's website. You must abide by mileage, repair and maintenance restrictions for leasing.

The Process for Buying Out a Car Lease

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The process of buying out a car lease is very similar to financing a first-time car purchase even though you already have the car. Unless you're paying cash, you must apply for financing and budget for fees such as taxes, registration and titling costs. Expect to arrange for financing if necessary and budget for additional fees.

You'll need your total lease buyout amount to purchase your leased vehicle. Call your leasing bank to obtain it or review your contract. Leasing contracts list the lease purchase price as the last payment due. Philip Reed, the Edmunds.com senior consumer advice editor, suggests negotiating the purchase price of your vehicle. Reed suggests offering your leasing bank less than its average retail value. You can obtain the vehicle's retail value at Edmunds.com, the NADA Guides or Kelley Blue Book website. You may save thousands of dollars if the bank accepts your offer.

Once you have your purchase price, secure financing or payment. If you plan to finance the vehicle, you can apply to any auto loan provider you'd like. Leasing banks rarely offer competitive interest rates for used car loans, so be sure to compare the leasing bank's interest rates to those of other auto loan providers. Check the interest rates of credit unions, local banks or online lenders. Submit a credit application for the car's purchase price to determine your loan term, rate, approval amount and monthly payment.

Before moving forward to purchase your leased vehicle, determine how you'll pay for additional fees required for purchasing a leased car. Many states do not charge sales tax on a vehicle's total price when leasing. Expect to pay taxes on the vehicle's purchase price, which can add thousands to your vehicle's buyout amount depending on where you live. Contact your state motor vehicle department to determine the total cost of additional fees. You may want to provide a down payment toward your loan amount or arrange to finance the extra costs.

Once your loan is approved, expect to sign loan contracts with your new lien holder and to obtain a check to provide to your leasing bank. Many leasing banks lack local presence, so plan to mail the check or work with your lender to electronically transfer funds to the leasing bank. Any down payment amount should be provided to the leasing bank to decrease your total loan amount. If you pay cash for your purchase, expect to receive the vehicle's title by mail or an official lien release to clear your current title, depending on where you live. Complete your state's process for transferring vehicle ownership or sign necessary forms with your lender.

Car Refinancing in South Carolina

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To decrease monthly car payments, borrowers can refinance their vehicles with their existing lenders or new lenders, lowering their interest rates. Generally, state laws govern the rights consumers have when they refinance their vehicle loans. In South Carolina, the Department of Consumer Affairs provides information to consumers who refinance their automobiles from lenders conducting business within the state.

There is no legal three-day rescission period to cancel car loans under federal or South Carolina law. The cancellation rights apply to homes and transactions made at a consumer's home. However, when consumers refinance their car loans, they most likely sign loan documents at their banks or dealerships, and therefore, the three-day rule does not apply. If the vehicle refinance occurs at a borrower's home, then she would have the right to rescind her contract within three days. Vehicle loan lenders are prohibited from taking a consumer's furniture or household appliances in exchange for providing the loan.

Under South Carolina law, all lenders must provide consumers who default on their vehicle loans a right to cure their deficiency before they can repossess or reclaim their collateral. Lenders must give borrowers who default at least one opportunity to catch up on their payments within 20 days. After 20 days, a lender can pursue repossession if the borrower does not settle her deficiency. If she settles her deficiency and falls behind again, her lender does not have a legal duty to provide her with another right to cure. Although lenders do not have to provide more than one right to cure, they must notify consumers in writing of their default. Lenders have five days to send the notification letter to borrowers with the delinquent amount owing and the entire amount they must pay to avoid involuntary repossession.

Sublease lenders cannot refinance a borrower's loan without first obtaining his written permission to do so.They may not accept fees from third-party lenders or any other interested parties without first obtaining consent from the borrower to refinance his car loan. Furthermore, the Department of Consumer Affairs has the legal authority to impose annual limits and regulations for interest fees, finance charges and late fees.

Since state laws can frequently change, do not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in your state.

10 Questions to Ask When Buying a Used Car

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When you are buying a used car you can get some of the car's history for free by using the vehicle identification number, known as the VIN, and a VIN search website. Use focused questions to check on the history of the car that may not show up in a VIN report. You can also use information that does show up in the VIN report to find out if the seller is being honest with you. Get everything you are told in writing from the seller before you purchase the car.

People sell their vehicles for various reasons. If the person is selling the car because it is costing too much to maintain, then he will not tell you that when you ask. Watch how the seller answers this question. If he seems nervous, or is not looking you in the eye, then he may be lying.

Getting a car lock and ignition changed can be expensive. Ask how many sets of keys there are for the vehicle, and then ask for all of the sets when you make the purchase.

This is an answer you can later confirm with the VIN report. It is asked only to see if the seller is being upfront with you.

Every used car has something about it that you should know before you buy it. The door lock needs to be pushed a certain way to work, or the car needs to idle for a minute or two when you first start it in cold weather. These are not necessarily bad things, but they are good to know if you will be owning the vehicle.

A car with 40,000 miles of city driving on it has more wear and tear than a car with 40,000 miles of highway driving. The starting, stopping and many turns involved with city driving can take their toll on a vehicle.

Sometimes a car will be the subject of a recall, and the owner will forget to get the recall work done. Recalls will show up on the VIN report, and if the seller forgot to get the recall work done then you should contact a dealer to see if you can get the work done after you purchase.

If a seller has nothing to hide, then he will not have a problem giving you a 15 or 30-day money-back guarantee. Each state has a "lemon law" that may cover the purchase of a used vehicle, and you can contact the attorney general for your state to find out your lemon law rights. But if you can work out something with the seller in advance, you may be able to get your money back without having to hire an attorney.

Some sellers will answer this question and some will not. If the seller gives you the name of their regular mechanic, then go talk to that mechanic about the vehicle and see what he knows.

Before you purchase a used car you should have your mechanic look it over and give an estimate for any repairs he feels the car may need. Discuss the estimate with the seller to see if she will pay for the repairs before you purchase the vehicle.

Buying a car when the finance company still has a lien on it is difficult and expensive. Before you agree to purchase the vehicle, ask to see the car title with the lien release on it.

Bad Credit Car Refinancing

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Refinancing an auto loan while you have bad credit may not prove beneficial. However, if you had poor credit when you first initiated your loan, you can save thousands by refinancing at a lower interest rate. Before pursuing a refinance, consider your current credit situation and whether a refinance is financially beneficial.

Refinancing your vehicle allows you to take advantage of interest rates that may not have been available when you originally initiated your loan. Whether your credit has improved or rates have dropped, a lower rate can offer lower payments and decrease the amount of money you pay back to your lender over time. Also, if you have money to put down toward your refinance, you can enjoy a cheaper monthly payment or shorter term, whereas putting extra money toward your current loan will not change your monthly payment requirement.

If your credit rating has suffered since your original loan, refinancing your loan may not save you money. Obtain a copy of your credit report to determine if your credit has gotten better or worse. AnnualCreditReport.com allows you to obtain a free credit report from each credit bureau annually. Make sure your report does not show past due payments on revolving accounts, such as loans or credit cards. Many lenders require borrowers to bring account payments up-to-date before extending a loan.

If your vehicle has been repossessed but your lender will allow you to get the car back if you pay the loan in full, a refinance is likely your only option. Even if your credit has suffered, a high interest-rate loan is a better option than a repossession, which damages your credit for years to come. Apply at local banks or online; search for a subprime lender if all other avenues fail. A subprime lender extends loans to high-risk borrowers, although rates and terms are uncompetitive. If you do obtain an approval, your interest rate may be higher than you expected. Make sure the payment is affordable before you agree to the loan.

If you cannot obtain a loan with a better interest rate, fair term or with an affordable down payment, consider applying for a loan with a co-signer. A co-signer secures a loan, but must put his credit on the line. You might also consider selling your car. If your current rate is too high or the payment is no longer affordable, sell your vehicle for the loan's total payoff amount. If you planned on purchasing another car, you can also trade your current vehicle to a dealership.

When to Break a Car Lease Document You've Signed

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If you can't pay your vehicle lease payments any longer, call your leasing bank as soon as possible. Otherwise, breaking your lease contract results in repossession, which significantly damages your credit rating. Other lease-end options, besides breaking your contract, may prove a better option. Break your lease contract only after you've exhausted all other options.

Before you decide whether or not to break your car lease, call your lender as soon as you know you can't make your lease payment. Many banks prefer to work out a payment plan with a distressed borrower rather than repossess the vehicle. Ask your bank about deferring your payment, which allows you to miss one or more payments without penalties or late fees. Or, your bank might lower your lease payment amount for a period, allowing you to catch up on past-due payments.

If you've already talked to your lender and still can't pay your lease payments, explore other lease-end options. You can purchase your vehicle from the leasing bank at any time, allowing you to sell your car or trade it to a dealer toward another purchase as long as you pay the bank the lease buyout amount. If your car sells for less than the lease buyout amount, you'll have to satisfy the remaining buyout balance yourself. Consider a lease assumption, which is transferring your lease to another person. If your bank allows this, another person can take over your lease but must abide by the terms of the original contract.

Only after you've exhausted your other options should you break your lease and return your car to the bank. If you haven't paid your lease payment, expect your bank to seize the vehicle from your home, place of employment or a parking lot. You can also arrange to return the car to the bank or a dealer. After repossession, the vehicle will be resold at an auction or privately. You must pay your bank for its loss if the sales price does not cover the car's total cost, not just the lease amount.

Repossession is not an option that comes without consequence. Your credit score will drop significantly. Any loans or lines of credit you apply for in the near future are likely to be declined or warrant a high interest rate or sizable down payment. A repossession remains on your credit report for at least seven years. You'll also still have to pay the bank for its loss. If you don't make arrangements to pay the bank, it can sue you. If the bank wins its lawsuit, it can pursue a judgment and garnish your wages.

How to Break a Car's Rental Lease

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When you lease a car, you enter into a rental agreement under which the car's owner allows you to use it for a number of years in return for monthly payments. Although you are under a legal obligation to honor the agreement, lease contracts include clauses that enable you to terminate your lease before the end of the rental term. However, to protect the financial interests of the lessor or owner, early terminations usually prove quite costly for the lessee.

Instructions

Locate your lease agreement. Review the contract to see if it includes a clause for a lease assumption. If such a clause exists, someone else can take over your lease, in which case you avoid having to pay any penalties for terminating. However, you may have to pay a lease transfer fee.

Contact the vehicle owner and find out whether you can trade in the vehicle for a newer model. You may want to do this if the car you are currently leasing no longer serves your needs. However, when you trade in your leased car, the vehicle owner may still assess the early termination penalties by adding them to the cost of the lease on the new car.

Ask the vehicle owner how much you must pay in termination fees if you break the lease. Under the terms of the lease contract, the vehicle owner may have the option to assess penalties for wear and tear. You may also have to pay a penalty fee that amounts to the sum total of the remaining lease payments.

Surrender the keys of the car to the vehicle owner. Pay the penalty fees with cash or a cashier's check. Ask for a receipt showing a zero balance.

Can the Bank Garnish My Wage if I Voluntarily Repossess a Car?

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When you fail to make payments on your car, your lender can repossess it at any time. With a regular or involuntary repossession, the lender hires a repossession company to take the car away. A voluntary repossession of a vehicle occurs when you turn your car into the lender on your own volition.

A voluntary repossession still damages your credit. Though the lender may notate on your account that the repossession was voluntary, it is still a negative item on your credit report. The repossession will remain on your credit report for up to seven years. This may prevent you from obtaining a new car loan or other lines of credit such as a mortgage or credit card account.

After you turn your car into the lender, it will be sold at a public auction. The proceeds of the sale will go toward paying the remaining balance on your car loan. Typically, the proceeds from the auction sale are not enough to cover the full balance of the loan. Your lender will then hold you responsible for paying off this remaining balance. You may contact your lender to work out a payment arrangement to avoid being sued in court.

If you and your lender cannot work out a payment arrangement to pay off the balance of your loan, your lender will likely sue you for the remaining balance. Once a judge rules in the lender's favor, the lender has the right to garnish your wages to collect on your remaining loan balance. The judgment will also damage your credit score and appear on the Public Records section of your credit report for up to seven years.

Once a judge grants the garnishment order to the lender, your employer will soon begin garnishing your wages. If your wages are less than 30 times the current federal minimum wage per pay period, then the garnishment cannot occur. If your wages are more than 3-0 times the federal minimum wage, the garnishment can occur. The maximum garnishment percentage allowable by federal law is 25 percent of your income remaining after state and federal tax deductions.

What Are the Requirements to Refinance an Auto Loan?

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Each lender will set its own requirements for refinancing an auto loan. The guidelines for refinancing will in part depend on the reason you are seeking to restructure your loan.

There are two key reasons to refinance: first, to save money on the loan; second, to prevent default. If you are strictly looking to save money, you will face one set of requirements in order to accomplish this goal. If you are facing default and need to refinance in order to keep your loan, you will face a separate set of requirements to accomplish your very different goal.

To save money on your auto loan, you will need to show you have improved your credit since taking the loan. This may qualify you for a lower interest rate or better financing terms. It is also possible the credit market itself has improved, which can be an additional incentive to save money through refinancing.

If you are looking to prevent default, you are likely in a compromised financial position where your credit or income may have dropped. In this case, you will need to show the lender you can continue to make payments only if your monthly payments are reduced. You will need to verify that your lower income will cover the loan cost if the loan payment can be reduced.

How to Do a Voluntary Auto Reposession

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A vehicle repossession is never an easy situation, ultimately effecting your credit report and hindering your ability to purchase another vehicle. However, a voluntary repossession may be your only choice if have a dire financial situation or have exhausted all your options. Unlike normal repossession, voluntary allows the borrower to contact the lender to surrender the car, lessen the fees owed and set up a civil arrangement to resell the car and pay off the balance. It is important to note, however, that it is not an easy fix.

Instructions

Talk with your lender or bank about your choices. Explain why you would like to do the repossession.

Clear all of your personal possessions out of the car and set up a time and place to give the car back to the lender.

Wait for the lender to notify you of intent to sell the car at auction. The car will be sold to the highest bidder. If a balance is left on the car, you, the borrower will be responsible for paying it off.

Set up a payment plan with the lender to pay off the remaining balance on the car. Being responsible and communicating with your lender can help you to avoid wage garnishment or legal judgments. Set the payments at a reasonable and doable amount. Don't overextend yourself to pay off the balance. A large payment may be what led you to a repossession in the first place.

Can I Trade in My Car If I Still Owe on My Loan?

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Dealers take vehicles for trade even if a current loan exists. However, you may face difficulty when applying for a new loan if you owe more than your vehicle's value, known as being upside down. Before you decide to trade your financed vehicle to a dealer, consider the process and whether it benefits you financially to do so.

Even with a financed trade, you can shop for a car as normal. Your salesperson will ask if you want to trade in your vehicle. In most cases, you can pick out a vehicle to purchase and allow the dealer to appraise your trade. When a loan exists, your salesperson calls your lender for the loan's payoff amount. Your trade value and loan payoff are considered in your new purchase price and loan payments if you plan to use the dealer for financing. Once you agree to the purchase, the dealer quickly pays off your old loan to take ownership of the car.

If you owe less than your vehicle is worth, any credit goes toward your new purchase. For example, if you buy a $20,000 vehicle, but have a trade worth $10,000 and a loan balance of $8,000, $2,000 is deducted from your vehicle purchase, similar to a down payment. However, most states offer a tax deduction when a trade exists, so expect a tax break. In this same scenario, expect to pay tax on $10,000, not the purchase price. Most states recognize that you already paid tax on a trade.

If you owe more than your car is worth, the negative balance is transferred to your new purchase price. This can cause issues with a new finance. Banks offer loans based on a vehicle's market value, so without rebates (for a new car purchase) or dealer discounts, you may have to put money down to correct the loan and value amount. Lenders also use your credit standing to decide your loan-to-value ratio, so if you have excellent credit, the bank may extend up to 120 percent of the vehicle's value. Transferring a balance creates a negative equity purchase. Use a down payment to avoid carrying over money.

You can sell your vehicle on your own to make more money, even if the vehicle has a loan balance. Call your bank for the loan's payoff amount and sell your vehicle to pay your lender. Dealers offer wholesale value for trade cars, which is thousands less than you can make from a private sale. Selling the vehicle on your own can decrease the amount of money you need to put down toward a new purchase. Expect to pay your lender the difference between the vehicle sales price and payoff amount. This amount should prove less than the difference between wholesale value and the loan payoff amount.

How to Calculate a Minimum Lease Payment

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When you are looking to lease a car, the minimum lease payment is the least amount of money you would have to pay on the lease each month. Calculating the minimum lease payment (also known as the "bottom-line" lease payment) will allow you to pick the best deal from different financiers. Several factors affect the amount of the lease payment, including the vehicle's sticker price, the negotiated initial price, the vehicle's residual or salvage value, the lease term, the lease factor, the interest rate and the state's sales tax rate. With these pieces of information at hand, you can calculate the minimum lease payment by following a simple procedure.

Instructions

Find out the sticker price and determine the residual value. The sticker price, which is also referred to as the MSRP (manufacturer suggested retail price), is the price of the car before negotiations. The residual value is how much you expect the value of the car to be at the end of the lease term. Whereas the sticker price is a fixed and certain amount, the residual value is an estimate. For the following examples, assume the sticker price of the car is $25,000 and its estimated residual value is $13,750.

Determine how much of the car's value you will use up or "consume" during the lease term. To do this, deduct the residual value from the negotiated initial price. The negotiated initial price is the price you and your dealer agreed upon. For example, if the negotiated initial price is $22,000 and you expect the car's residual value to be $13,750, the value of the car you will use up during the lease term will be $8,250 (22,000 - 13,750).

Determine your monthly payments before interest and tax. To do this, divide the value of the car you will use up by the number of months in the lease term. For example, if the lease term is 36 months and you use up $8,250 of the car's value, your monthly payments before interest and taxes will be approximately $229 (8,250 36).

Determine the lease factor, which is a determinant of how much you will have to pay in finance charges during the lease term. To do this, divide the interest rate by 2,400. If the interest rate is 9%, the lease factor will be 0.00375 (9 2400).

Determine the amount of interest you will have to pay each month. To do this, multiply the lease factor with the sum of the negotiated initial price and the residual value. For example, if the negotiated initial price is $22,000 and the residual value is $13,750, the sum of the two will be $35,750. Multiply this sum with the lease factor (0.00375). The answer is approximately $134 (35,750 x 0.00375).

Add the monthly payment amount before interest and taxes to your monthly interest payment. For example, if the monthly payment amount before interest and taxes is $229 (see step 3) and the monthly interest payment is $134 (see Step 5), the sum of the two will be $363.

Add the applicable sales tax to this amount to arrive at your minimum lease payment per month. For example, if your sales tax rate is 7%, your minimum lease payment will be approximately $388 (363 x 1.07).

Information on Car Lease Rules

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Car leasing payments are based on a variety of bank-determined information, such as the car's expected depreciation over the lease term and payment interest rate. Each leasing bank sets it own rules, leasing provisions and fees. Before pursuing a lease, review your leasing bank's contract to determine its rules and requirements.

The bank you lease from ultimately defines the rules for your lease. A lease payment is based on the cost of the vehicle and its expected depreciation over the leasing term, which stays out of your payment. The car's depreciation cost, or the amount you pay for during the lease, is based on the term and mileage you choose. Once your lease contract is over, you can purchase the vehicle for the amount stated in your contract.

Lease-advertised mileage, term and down payment are adjustable. Manufacturers advertise a best-case scenario, which is based on certain leasing options that ultimately result in a low monthly payment. Leasing can be flexible; you can choose a term of 24 to 60 months and change the mileage allowance from 10,000 up to 18,000 miles per year. You can also change your down payment amount. Changing leasing terms affects your payment, as increased mileage or less of a down payment results in a higher payment.

Leasing banks require increased insurance coverage. The bank likely requires you to keep a full coverage insurance policy in effect during the lease term, which includes coverage to your vehicle in the event of an at-fault accident. The bank can also require that you purchase a gap insurance policy, which covers your loan balance if your insurance company's determined market value does not. Many banks also require higher bodily injury and property damage limits along with a lower deductible, all of which increase insurance cost.

The rules for your lease are outlined in the bank contract. Over mileage fees, which can cost up to 18 cents per mile over your allowance, are stated in your contract. The bank's rules for wear and tear charges are also listed. Fees might also apply if you transfer your lease to another party. Read your contract over to assess early termination charges, lease purchase price, insurance requirements and penalties. Read your paperwork over thoroughly before signing and keep your contract in a safe place in case any issues arise in the future.

How to Get a Repossessed Auto Back

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One consequence of not paying your auto loan on time is losing your vehicle to repossession. A lender may wait several months before initiating a repossession, or it may do so as soon as you miss one payment. Repossession, however, does not mean that your car is gone forever. The Federal Trade Commission notes that you have several options to reclaim your repossessed vehicle -- provided you can pay what you owe. The process for reclaiming your car after repossession depends on your state of residence.

Instructions

Read over your original loan contract. Look for a clause giving you a "right to reinstate." If your loan contract provides you with this right, you need only pay off the car payments you missed, along with any late fees and repossession costs, to recover your lost vehicle.

Call your lender and explain that your car was repossessed and you would like to get it back. Ask how much you need to pay to recover the vehicle. If your state does not require lenders to provide consumers with the right to reinstate a vehicle after repossession, you will need to pay off the full outstanding loan balance -- plus fees -- before the lender will release your vehicle.

Visit the lender's office and pay off the full amount you owe. After your reinstate the loan or pay it in full, your lender will return the vehicle to you.

Statutes and Administrative Rules & Regulations in Virginia When Selling a Car

3:22 PM No comments

A misstep when selling your car in Virginia could leave you with liability for the new buyer's mistakes. Therefore, it is important to carefully follow the administrative rules that the Virginia Department of Motor Vehicles has established for selling used cars. Although you should be aware of the rules before selling your car to a dealer, they are especially important for private party sales because the seller is likely unaware of the rules.

The seller must turn over the car title to the buyer at the time of the sale. If you have a lien on your car, you must get it removed before making the sale by contacting your lender. Once you have a clear title, fill out the name and address of the buyer, the vehicle's current odometer reading and the date of the sale in Section A of the vehicle title. Sign the title and ensure that the buyer also signs it.

The buyer will need to pay sales tax on the vehicle, so it is your responsibility as the seller to provide a bill of sale that lists the purchase price. At the time of publication, the sales tax was 3 percent of the purchase price. The simplest option is to write the sale price in the appropriate space on Section A of the car title, which can be used as a bill of sale. Alternately, you can either fill out the Affidavit for Procurement of Title for a car that is less than five years old or write your own bill of sale for a car that is more than five years old. The bill of sale needs to have the buyer's and seller's signatures and list the vehicle identification number (VIN), the date of the sale, the purchase price and the vehicle's make, model, color and year.

The license plates belong to the owner, not the car itself. When you sell your car, take off the license plates rather than letting the buyer drive away with them. Removing the plates protects you from liability for traffic infractions the buyer commits. You do not need to return the plates to the Virginia Department of Motor Vehicles. You can keep them, destroy them or transfer them to a different vehicle that you own. If you transfer them, contact the Department of Motor Vehicles to update the registration.

Notify the Virginia Department of Motor Vehicles as soon as you sell your car. You can call (804) 497-7100, visit a branch office or log in to the Virginia DMV website to submit a notification online. After you have notified the DMV, contact your auto insurance company to cancel the insurance on the car or transfer it to your new car. If you cancel the insurance before you notify the DMV that you sold the car, you could have your license suspended for owning an uninsured vehicle.

Can I Trade in My Car Owing More Than it's Worth?

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Approximately 22 percent of people buying new cars owe more on their old cars than they are worth, according to MSN Money. This is called being "underwater" or "upside down" on the loan. If you are in this situation, you have a few options when shopping for a replacement vehicle.

Some lenders are willing to roll over the remaining balance on your old car loan into your new car loan. For example, your trade-in is worth $6,000 but you still owe $9,000 on the loan. Your new car purchase price is $20,000. The lender might give you a loan for $23,000, which allows you to buy the new car and pay off the remaining balance on the old loan. However, be aware that you will start off owing more on your new car than it is worth, too. In addition, assuming the lender is willing to finance the loan, you will get stuck with a higher interest rate because the loan is not fully backed by an asset.

New-car dealerships often offer rebates, cash incentives to purchase the new car. If the amount of the rebate exceeds the amount you still owe on your old car, this is a convenient way to start out on the right foot. For example, you might owe $3,000 more on your trade-in than it is worth and select a new car with a $4,000 rebate. Use $3,000 of the rebate to pay off the loan and put the last $1,000 toward a down payment on the new car.

If you have enough cash available to pay off the balance of your old auto loan after the trade-in, this is typically a better choice than rolling the balance into a new loan. You will be able to get a better interest rate because your new loan is for an amount less than the cost of your new car. Your monthly payments on the new loan will be lower because it has a lower balance.

Unless getting a new car is urgent, you might want to wait until you have paid off more of your car loan before trading in the car. Because cars lose their value more quickly when they are brand new than when they are a few years old, you can catch up on your loan and get it to the point where you only owe the value of the car before you trade it in. Choose a new-car loan with a short term of no more than five years so you will not be as likely to be "underwater" next time.

What are the Terms of Leasing a Car?

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Exact leasing terms and options may vary between leasing banks. The most common leasing terms include monthly term options, mileage allowance, insurance requirements and any fees associated with the lease. You can find this information in your lease contract. Read your contract over before signing it to avoid any issues during or after your lease.

You must choose a monthly term to lease a vehicle. At the end of the term, you can return the car to the leasing bank or choose to purchase it. Lease terms differ by bank, but most offer terms from 24 to 60 months. Choosing a term up to 39 months is ideal, as you'll be driving the vehicle under its manufacturer warranty. Terms longer than 39 months usually result in a monthly payment similar to financing. Talk to your dealership to find out the payment differences of each term option if you would like to change it.

Your lease payment is based on the vehicle's expected depreciation, which is affected by the mileage you choose. Despite mileage offers listed in advertisements, many banks offer mileage choices of 10 to 18,000 miles per year. Based on the total amount of mileage the car will have at the end of the term, the bank guesses its future market value, which stays out of your lease payments. If you go over your mileage allowance, you'll pay penalty fees that may range from 10 to 20 cents per mile. Mileage choices beyond 15,000 miles per year usually result in a monthly payment similar to financing, as well.

During the term of your lease contract, you must maintain a continuous collision policy with limits and deductible options required by the leasing bank. If you do not maintain this coverage, your bank may pursue repossession or add a high-cost insurance policy to your lease amount that increases your monthly payment amount. Most banks also require lessees to purchase a gap insurance policy, which you can buy for a one-time fee of $100 to $600. If your insurance company declares your vehicle a total loss, the gap insurance policy pays for the car's entire value so you don't have to.

Various fees are associated with leasing. To determine which fees your bank charges, read your contract thoroughly. You must maintain and repair your vehicle so that it remains in good condition throughout the term of the lease. Your contract may state a wear-and-tear limitation, such as up to $1,000, which may cover the wear your car sustains over the leasing term, such as lightly worn seats or light scratches in the vehicle's paint. You may also find that you have to pay a fee upon returning your lease at the end of the contract.

How Does Using Money As Collateral Work on a Car Loan?

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Generally, when you take out a car loan you use the car being financed as the collateral for the loan, which means that the lender can repossess the car if you default on your loan payments. However, you can also finance a car by using a cash-secured loan, in which case the lender has no claim upon the car.

In order to take out a cash-secured loan, you must first establish a deposit account such as a certificate of deposit or a savings account. You must deposit a sum of money into the account that matches or exceeds the amount that you intend to borrow to finance your car. The bank places a freeze or hard-hold on the CD or savings account, which means you cannot access any of the money in the account until you have paid off the loan.

When you take out a CD or savings-secured loan, the lender does not have to check your credit report since your deposit account provides your lender with liquid collateral that cannot lose value over time. However, you must provide your lender with evidence of your income in order to prove that you can afford to repay the loan despite having no access to the funds in the frozen deposit account. Your lender may limit your loan amount to a sum of money just below the balance of your deposit account in order to allow for any late fees that you may incur.

When you take out a regular car loan you must pay interest on the debt and interest rates on car loans roughly follow the United States prime rate. Interest rates on cash secured loans also follow prime rate so you pay roughly the same rate on either a car loan or an auto secured loan. However, the interest that you earn on the CD securing your cash loan, offsets the interest that you pay on the debt. Therefore, cash-secured loans are less expensive than regular car loans.

It may seem nonsensical to pay to borrow money in the form of a cash-secured loan when you have sufficient cash to buy a car. However, many people who have poor credit use cash-secured loans to buy cars because the loans are reported to the credit bureaus. Typically, car loans have term times of between two and six years and assuming that you make your payments on time, you can significantly improve your credit score by taking out one of these loans. When you receive the loan proceeds, the bank makes the check payable to you so in actual fact you can use the money for any purpose and not just for buying a car.

How to Buyout a Car Lease

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Leasing a car is sometimes the best option for consumers as it provides a smaller monthly payment to work with. In some cases, after leasing a car, you decide that you no longer want to lease and would rather buy the car. While you lease the car, the leasing company may give you the option to buy the vehicle. Buying out a lease allows you to get out of the contract and start using the car as you want.

Instructions

Review your lease paperwork. When you lease a car, the car dealer provides you with information about buying out your lease and the process for turning your car back in. The paperwork typically includes information about the amount to buy the car at the end of the term. This gives you an idea of what you will pay for the car if you wait until the end of the term.

Contact the dealer to find out what the current buyout price is. The buyout price changes as you make payments on the lease and the value of the car fluctuates. The dealer can calculate the current buyout price for the vehicle and give you a quote.

Arrange the financing for the purchase of your vehicle. If you have cash, you may simply pay the dealer directly. If you have to get a loan, apply with an auto lender and get a check once you are approved. The lender will give you a check to give to the dealer for the purchase of your vehicle.

Set up a time to visit the dealer and bring the payment for the vehicle with you. You will complete some paperwork and give the money to the dealership before the car will become yours.

Pay the sales tax with your local department of motor vehicles or state revenue office.

How to Lease a BMW

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Leasing a BMW is different from leasing an average car. For starters, luxury cars tend to hold their value. In fact, a high resale value creates a low monthly lease payment. Individuals interested in leasing a luxury car usually prefer convenience and like to avoid maintenance or repair work.

Instructions

Decide what you want to lease. The 2009 and 2010 model years of BMW offer more than a dozen models to lease. Each car has different options and features. Consider whether you want a well-equipped car or a standard edition.

Determine your ideal financing and leasing structure. Keep in mind variables such as length of the lease and mileage allowance. One lease advertised by BMW is a 36-month lease, well equipped, for $369 per month. Some leases have a cash offer depending on the model and year.

Understand the terms of the lease. Considerations include down payment, first month's down payment, security deposit, acquisition fee and cash due at signing. Some of these factors might be fixed depending on the dealership, but changing any of them usually affects your monthly lease payment or the amount due at signing.

Estimate your monthly payment. The BMW website has a robust tool for estimating monthly payments based on the state of purchase, model type and dealer accessories.

Decide on financing. Payment options include EasyPay (paying directly through your financial institution), PrePay lease (single upfront payment that is less than the sum of monthly payments on a traditional lease), Multiple Lease Security Deposits (reduced lease payments resulting in a higher refundable security deposit), and Advanced Financing Payments (pay in advance without prepayment penalties).

Contact the dealer. Locate a dealer in your area at bmsusa.com and make an appointment; or, to speak to a BMW representative, call toll free (800) 578-5000.

Use non-BMW dealership resources. Sites like swapalease.com allow car leaseholders to negotiate exchanges on leases. BMWs swaps are popular. Note that a swap implies that you already hold a lease.

How to Get a Repo'd Vehicle Back

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A re-possessed car is not necessarily gone for good, but consumers must act quickly to get a repo'd vehicle back. The procedure varies depending on the state in which you live, but most jurisdictions provide opportunities to get the car back if certain guidelines are met. If you are not able to negotiate favorable terms with the creditor, you will be able to get your personal possessions from the vehicle, such as electronics, maps and anything else kept in the car at the time it was re-possessed.

Instructions

Verify that the car has been re-possessed. Contact your lender to make sure they are responsible for the missing vehicle. Let them know that you are interested in getting the car back.

Determine the outstanding balance on the loan. In order to get a repo'd vehicle back in most jurisdictions, you must be able to remit the outstanding balance to the lender.

Ask about other fees required to get the repo'd vehicle back. According to Consumer Action, the loan company can insist you pay the entire loan on the vehicle rather than just the balance owed, as well as any expenses they incurred during repossession.

Find out if you are eligible to get the repo'd vehicle back. In some areas, such as Los Angeles County, loan companies can refuse to give back a re-possessed car if certain criteria exist, such as a prior re-possession within twelve months or trying to hide the vehicle from the re-possession company.

Pay the balance on the loan and any other fees the loan company requires. Make sure you get a receipt for any funds remitted and that you receive the title to the car if you pay it off in full.

Car Grants for the Disabled

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According to a survey conducted by the U.S. Census in 2005, roughly 41.3 million Americans suffer from some kind of disability. From mental to physical, disabled individuals are greatly impacted as well as their families. To improve the livelihood and accessibility of disabled individuals, several governmental programs, foundations and organizations provide grants for the purchase of adaptive automobiles and equipment.

The Department of Veterans Affairs provides grants up to $11,000 for disabled veterans for their service. To be eligible, veterans must have suffered the impairment or loss of vision or one or both hands or feet in the line of duty. In addition to the $11,000, the department provides grants for adaptive equipment on current cars, such as steering handles and wheelchair lifts.

U.S. Department of Veterans Affairs

810 Vermont Avenue

Washington, DC 20410

800-837-2000

va.gov

The Muscular Dystrophy Family Foundation assists with the purchase of adapting equipment for current automobiles for families that qualify. For those individuals suffering from muscular dystrophy, grant funding is provided for specialized driving equipment such as van lifts. In some cases, disabled individuals can received funding to purchase larger vehicles such as vans.

Muscular Dystrophy Family Foundation

7330 US 31 S.

Indianapolis, IN 46224

800-644-1214

notboundariesff.org

The Brighter Tomorrow Foundation serves disabled individuals in Dayton, Ohio. The foundation provides programs and grants to disabled individuals and their families to help improve their quality of life. In addition to helping with housing, education and extracurricular projects, the foundation provides grants for adaptive car equipment. The foundation assists disabled citizens and their families in living full lives by awarding equipment such as special steering-wheel handles, chairlifts and vans.

The Brighter Tomorrow Foundation

600 Kettering Tower

Dayton, OH 46421

927-223-4490

brightertomorrowfoundation.org

Car Repair Vs. Buying Another Car

3:40 AM No comments

Consumer reporter Clark Howard told people on his radio show that, on average, people get a new car every three or four years. During a down economy, however, many people can no longer afford that luxury. Hanging on to your car, even if it means making repairs, is one possible money-saving option, but you need to know how long you should hold onto your car and when to throw in the towel.

It's a happy day when you've made your final car payment and can now drive your vehicle free and clear, barring gas, maintenance and insurance. But with older cars, something invariably goes wrong, and you have to shell out some bucks for repairs. The first time that happens, it might not be a big deal; you might even have expected to make a repair, but as the car ages and you are pouring more money into it, determine whether it's time to get rid of the car.

According to Edmunds.com, some expensive repairs are unavoidable on an aging car, such as axle boots, brake rotors and the timing belt, usually around the 90,000 to 120,000 mile mark. While these types of repairs are going to hurt your wallet, it is almost always cheaper to get them done than to buy a new car. If you have a blown motor or a bad transmission and your car is worth more than the cost of the repair, go ahead and get it done, because that repair is still going to be cheaper than buying new.

If you don't want to worry about your car breaking down on you at an inopportune time, you might want to buy a new car. Once your car gets to a certain age, getting it repaired does not guarantee that you won't have to repair it again soon. You won't have to worry about a new car breaking down for at least three years. If you are spending more time at the repair shop than you can afford, you also might want to get a new car. Sometimes, the mechanic doesn't fix your car properly, which could require several frustrating back-and-forth trips, cutting into time you could be at work or with your family, in addition to the expense.

Perhaps the most basic way to determine when to repair versus when to buy another car is when the cost of repairs is going to be more that what the vehicle is worth. Check the Kelley Blue Book to find out. If that is your situation, your best money-saving bet is probably to buy a used car. Avoid a new set of problems by taking the vehicle to a mechanic before you buy it, and only buy it if the mechanic confirms that the car is in good shape. Buying a certified used vehicle, which is a car only two or three years old, is usually a good way to go because these cars often come with warranties, backed by the manufacturer.

To make your car last as long as possible, maintain it regularly by following the directions in your car's service manual. You'll want to change the oil and filters, get transmission tune-ups and rotate your tires on a routine basis. Most cars can last up to 200,000 miles, according to MSN Money. Tuck away $50 a month, so you'll be prepared for a repair.

Advice on How to Negotiate Low Car Payments

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Your ability to get a payment you can afford determines whether you're able to buy a new automobile. The interest rate on the vehicle loan impacts the car payment, so getting a low payment involves acquiring a low rate. Several factors can help you get the best rate possible on your next auto loan.

A bad credit history or low credit score means you're more likely to default on an automobile loan. While this may not stop you from getting a vehicle loan, low credit scores and higher interest rates go hand-in-hand. Getting a lower rate and a low car payment requires reducing your credit risk and improving your credit score. Timely debt payments and reducing debt can help bring up your FICO rating.

Down payments help bring down car payments in two ways. First, a down payment of 10 to 20 percent reduces the auto loan balance. Second, a down payment helps you negotiate a lower interest rate on the loan. If buying a car for $20,000, consider a 20 percent down payment of $4,000.

Dealerships aren't the only potential providers of financing for your new vehicle loan. You have several options, including getting a loan from your bank or credit union. Dealerships are the middleman, and they often pad or increase interest rates to make money. Going directly to the bank can result in a cheaper rate and lower car payments.

Financing a car for two or three years helps you pay off the vehicle more quickly. Unfortunately, a short finance term also increases the monthly payment. If you're interested in keeping payments low and affordable, negotiate a longer vehicle term. Five-year terms are typical, but some finance companies eagerly extend vehicle loans to six or seven years. Bear in mind that you'll pay more interest with a longer-loan term, which increases the total cost of the car.

Monday, November 30, 2009

Instructions

Sunday, November 29, 2009

Set the Sales Price

Car Dealership

Used Car Lot

Auto Auction

Classified Advertisements

Debt-to-Income

Unemployment

Worker's Compensation

Other Considerations

Saturday, November 28, 2009

Payoff Amount and Procedure

Budgeting for Loan Payoff

Communicating with Potential Buyers

Payoff Process

Thursday, November 26, 2009

Check Your Credit

Bad Credit Loans

Refinance Your Loan

Instructions

Manufacturer Incentives

Used Car Rate Offers

Term Options

Lease Option

Wednesday, November 25, 2009

Obtain the Lease Buyout Amount

Secure Payment

Budget for Other Fees

Complete Payoff and Paperwork

Tuesday, November 24, 2009

Dispelling Myths

Rights to Cure Deficiency

Written Consent

Considerations

Monday, November 23, 2009

Why Are You Selling The Car?

How Many Sets Of Keys Are There?

Are You The Original Owner?

What Quirks Does It Have?

Did You Do Mostly City Driving Or Highway Driving?

Was There Any Recall Work?

Is There A Money-Back Guarantee?

Do You Have A Regular Mechanic?

Will You Pay For Repairs?

Is The Lien Released?

Saturday, November 21, 2009

Benefits of Refinancing

Considerations

Repossession

Other Options

Contact Your Lender First

Other Options

Repossession

Repercussions

Friday, November 20, 2009

Instructions

Wednesday, November 18, 2009

Credit Damage

Vehicle Auction

Lawsuit

Garnishment

Purpose

Credit Requirements

Income Requirements

Tuesday, November 17, 2009

Instructions

Trade Process

Equity

Negative Equity

Other Options

Instructions

Lease Payment Determination

Options You Can Change

Insurance

Fees

Sunday, November 15, 2009

Instructions

Car Title