The Best Auto Loans

The best auto loan rates go to the customers who are best prepared and have the best credit. The major auto loan lenders' top-tier packages are relatively standard. So if one lender is willing to give you a low rate, chances the others will match it. The trick is being prepared and in a position to demand the best interest rate available.

Know Your Credit

Check your credit report and make sure the information on the report is accurate. Errors, no matter the size, can make a difference in your credit score, and thus in your interest rate. Once you learn your credit score, research what local banks are offering customers with your credit history. And don't forget credit unions, which generally offer some of the best deals. If you have a high credit rating you can expect to get more favorable interest rates.

Set a Budget

Having a budget planned in advance and determining the down payment you can afford will go a long way in helping you get the best rate. Knowing what you can afford means you have the knowledge to determine if you can go with the lower rate and shorter payback term or if you need a longer term loan. Auto lenders offer payment terms as long as 80 months. The longer payback term means more interest over the term of the loan and may mean higher fees, as well.

Comparison Shop

Compare lenders and loans offered through dealers, who may have various loan incentives in place when you shop for a new car.

Ask For it in Writing

You know your credit score. You have an idea of the rates that you qualify for from different sources. You have planned out the down payment amount and the pay back term you can afford. Now you have several offers presented to you to consider from lenders and dealers. Make sure you get an offer in writing and list any contingencies that could affect the terms.