How to Save Money on Car Loans

Saving money on Washington car loans boils down to shopping around and avoiding some common financial pitfalls. Here are some tips to help you minimize the cost of your loan.

Use Home Equity

Home equity is probably the best way to lower the rates of Washington car loans. To finance a vehicle, you can take out either a home equity line of credit (HELOC) or a home equity loan. Both loans typically offer lower rates than traditional Washington car loans because they are secured against the value of your home. As an added bonus, the interest on home equity Washington car loans is usually tax deductible. A HELOC can offer lower initial interest rates, but it involves more risk because the rates could rise later, making your payments unaffordable. Don’t choose home equity Washington car loans unless you have the discipline to make every payment on time. If you don’t, you could lose your home.

Independent Financing

Independent financing refers to any financing obtained outside of the car dealership. This is what our lenders offer. Getting Washington car loans through an independent source is also very convenient, as you can finalize the financing before you even set foot in a dealership. Independent financing also allows you to get Washington car loans directly from a lending institution rather than having to go through a dealer middleman. A common dealer scam is to ask you what monthly payment you can afford, and the dealer will then manipulate the terms and interest rate of the loan to meet this figure while making huge profits off the deal.

Before you apply for Washington car loans or any other type of loan,
you should check your credit score and your credit report

Be Wary of 0% Financing

Many dealers attract car buyers by offering 0% interest Washington car loans. However, 0% financing is often a bad deal for several reasons. For one, only a very small minority of consumers have the requisite credit to qualify for these loans. Secondly, dealers usually offer 0% financing as an alternative to a cash rebate. Almost always, you are better off taking the cash rebate and getting Washington car loans from an independent source.

Check on Your Credit

Before you apply for Washington car loans or any other type of loan, you should check your credit score and your credit report. Review them for any inaccuracies and dispute errors in writing with the credit bureaus. In addition, you should also check your report for any liabilities that could hurt your chances of qualifying for Washington car loans. For instance, if you have unpaid credit card bills you could easily pay off, do so before you apply. Simple things like this can get you a significantly lower rate on Washington car loans. Check out our FAQ section if you have any questions.