Car Loans APR – Facts And Pros

by Charles Martin on February 19, 2012

When you take a car loan, you will be paying the loan back in instalments with interest. The annual percentage rate of the loan is a very important factor to be taken into account. The lower the APR on the car loan, the better for you, if you have a stable job and a regular income that does not vary, your APR can be at a reduce rate.

Good Credit Rating Can Help

If you have a good credit rating which is not difficult to get, you should try and pay back all your credit purchases and credit card purchase account dues in time so that you have never defaulted and thereby increase your credit rating. This can get you a facility on your car loan with a lower APR and lower instalments. If you take loans that you can afford to pay back comfortably every month according to their instalment, then you can easily increase your credit rating.

You can also reduce your APR by getting your auto refinance loan, a refinance loan is taken to pay off the previous loan in full for the balance amount and pay the new loan in easy instalments with a lower APR. Even in this situation you need to maintain a good credit rating to avail of beneficial refinancing loans. Refinancing is simpler and easier process of lowering the APR.

Pay a Part of the Principle with Monthly Instalment

If you pay a part of the principle amount of the loan with every monthly instalment, you will not only reducing the loan amount but also the APR as your principle goes on reducing, the cost of your car will also reduce which will earn you a good negotiating and upper hand. You can also opt for a home equity credit and payoff the loan that has a higher APR including the monthly payment. You will only be left to pay the unpaid amount.

If you search online you will come across many loan providers with lower APR’s. Off course refining or improving your credit rating can help you a great deal but it would be better to go for car loans that are available online at every affordable APR and many facilities to repay back the loan.

Looking for dealers specializing in bad credit car loans. Before you visit the dealer find out what is a average FICO score for a car loan. There are a lot or errors in credit report, so it is important to get a credit report

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