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Drive
Away with a Good Deal |
by:
ARA |
(ARA)
- With interest rates at all-time lows,
consumers are taking advantage of the long-term
savings on big ticket items like cars. If
you're one of the many people who are planning
to buy or lease a new car, make sure your
finances are in order so the purchase process
is hassle free.
First, do an honest assessment of your current
financial situation. Can you really afford
to buy or lease a new car, or does it make
more sense to get as many miles as possible
out of your current car? Despite low interest
rates, a new car isn't a bargain if it means
you'll be turning to credit cards to pay
other bills. You know the details of your
expenses and budget better than anyone else.
Doing your homework before you shop will
enable you to set a payment you can live
with.
Once you can say for certain that new car
payments fit within your budget, you need
to turn your attention to your credit rating.
Lenders will use a report from one, two,
or all three of the credit reporting agencies
to assess your creditworthiness, so your
first step should be reviewing your credit
report(s) for accuracy and for any information
that may hurt your chances of getting a
loan. The information on the credit report
can also affect the interest rate the lender
will give you. The easiest way to get a
copy of your credit report is from an online
service like www.creditmatters.com.
If you find inaccuracies on your credit
report, you should take steps to correct
that information before you apply for a
car loan. Look for obvious mistakes on your
report, such as credit card accounts that
aren't yours and closed accounts that have
not been used for more than seven years,
but are still showing as open. You can dispute
items that you feel are inaccurate with
the credit reporting agency by following
the directions included with your credit
report.
If you have a large number of credit cards,
you may want to consider canceling some
of your accounts. Lenders may look at these
open credit accounts as potential debt.
Likewise, every time you apply for credit,
lenders will more than likely request a
copy of your credit report. Multiple inquiries
from lenders or creditors can lower your
credit rating, so minimize the number of
inquiries to your report until you get your
auto loan.
If your credit history isn't as good as
you'd like, there are no quick fixes, but
time, as they say, is on your side. Many
lenders focus on the past two or three years
of your credit history, so with a plan and
some patience, you can boost your credit
rating. Take control of your credit by paying
bills on time. Cancel any credit cards you
aren't using or minimize excessive amounts
of available credit, which could tempt you
to buy things you can't really afford. Gather
all your bills and draw up a budget that
allows you to pay them off one at a time,
focusing on the account with the highest
interest rate first.
Having a co-signer may make it easier to
obtain a loan if your credit is not perfect.
But before you ask a friend or family member
to co-sign, be sure you both understand
what that entails. A co-signer is guaranteeing
this debt. If the borrower does not pay,
the co-signer may have to pay up to the
full amount of the debt, and if he or she
can't pay in full, their credit rating will
be adversely affected. Additionally, late
payments will go on both credit reports.
Even though you would never put your co-signer
in this position on purpose, consider what
would happen if you lost your job, for example.
Are you willing to risk your relationship
with your co-signer for a new car?
Buying a new car should be fun and exciting
-- you get to pick the make, model, color,
and options. Arming yourself with the facts
ahead of time will help take the hassle
out of car buying and put a smile on your
face as you drive off the lot knowing you
got a good deal.
For more information on taking control of
your credit rating, visit www.creditmatters.com.
Courtesy of ARA Content
About the author:
Courtesy of ARA Content
Circulated by Bandoni
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