5 Tips to Help You Secure Your First Car Loan
- Written by Diana Smith
Getting your first car loan is not a simple task. It requires you to figure out several things, make a priority list and follow a bureaucratic procedure. Most importantly, just because you have a certain type of credit score, want a specific term on your loan and intend to raise a certain amount of money, this doesn’t mean that the loan terms will be the same everywhere. What you need to do is shop around. All in all, there’s a lot of work in front of you so here are five tips to help you secure your first car loan successfully.
1.Make a budget
The first thing you need to do is make a budget. The biggest cost is the car purchase itself. So, determine the amount of money that you intend to invest in this car. You can go on an online car sales platform and see the model, the make and the age of the vehicle that you want to purchase. This will give you a general idea of the price range. Next, you need to consider various closing fees and taxes regarding the transfer of ownership (if you’re buying a used car). There are additional expenses as well, like maintenance, insurance, etc. Once you have the final figure, you’ll be ready to proceed to the next step.
2.Check your eligibility
The next thing you need to do is to read about car loans in general. You should look at the procedure of applying and getting approved for the loan. One of the factors that play heavily is your credit score. This is a score calculated based on factors like payment history, amounts owed, length of credit history, new credit and types of credit used. Generally speaking, this is a method that banks and lenders of all sorts of use in order to check how trustworthy you are. Based on this, you might get better or worse terms. Going for a specialized loan (car loan) is also an idea that can end up going in your favor.
3.Shop around
Now that you know the amount of money that you need and how you can get it, it’s time to start shopping around for loans. In the age of the internet, doing your research has never been easier. Keep in mind that the investment that you’re about to make isn’t insignificant, which is why it’s pivotal that you actually do proper research. In Australia, there are so many decent lending options that you really shouldn’t have much trouble with it. Simply look up convenient car loans in Australia and see what they have to offer. Even with a bad credit score, you will probably be able to find a decent loan option, which should put your mind at ease.
4.Submit an application
Next, you need to submit an application for a car loan. Depending on the lender, the procedures may differ. Nowadays, the majority of people look for specialized lenders and online lenders. These procedures are often a lot simpler and more intuitive. All you have to do is check several boxes, provided that you fulfill their criteria. More often than not, you need to mention whether you have a regular income, how much money you want to borrow and what your credit history is. You might also have to confirm that you’re older than 18. All in all, it usually doesn’t take long for the approval to arrive.
5.A good car broker makes all the difference
In the end, you need to understand that the cost of the car might depend on the car broker. Just because a certain model is $8,000 on the majority of platforms, this doesn’t mean that this particular car is worth that much. Even if it is, this doesn’t mean that you have to pay the full price for it. Think about it, while this is a major expense, it’s not the only or the last expense that you’ll have regarding this purchase. Try to save every dollar you can and having a good broker can make this happen.
In the end, you need to grasp the full significance of this. You see, unlike buying a house, chances are that you’ll buy more than one vehicle in your lifetime. This means that you’ll have to apply for more than one car loan over the years. In other words, it’s a life skill and the sooner you adopt it, the more you’ll get to benefit from it. Fortunately, a car loan is never something that you’ll be in a rush for. There’s always time to do your research.
