Current national interest rates for a 60-month loan on a new car are averaging 5.24%. You won’t see finance rates any lower than that. And it will be a long time before you see them that low again. If the economy starts picking up, and it’s showing some signs of improvement now, then interest rates will surely rise. That means any car purchase you make in the future will cost you more in the long run. You can save money – maybe even thousands of dollars – by financing your automobile right now.

New auto loans can be lower than used auto loans. In fact, if you finance a new car purchase over a 72-month period, you can get a loan rate of below 4%. Not only will your monthly payments be lower, but you’ll save money on the interest rate too.

That’s why I believe now is the best time to buy a new car on loan. It’s never been better.

1. What is the interest rate? This is expressed as APR – Annual Percentage Rate. This rate will determine your monthly payments. But you should note whether it is in the same vicinity as prime, or market rate for similar loans.
2. Are there any penalties or hidden fees? Some car finance companies will apply a penalty if you pay your car loan off early. You’d better know that before getting in. And also ask if there are any hidden fees. All your fees should be disclosed right up front.
3. How much are you paying for the vehicle? This is the actual price at the end of your loan period. The cost of the vehicle, minus your down payment, plus the amount you pay in interest over the life of your loan plus any fees associated with your loan.
4. What is the total amount you are being finance? This can often be tricky. It’s hardly ever the exact price of the vehicle. If you put money down, then that money will be subtracted from the total price of the vehicle before you start making payments. Find out if any of the fees for your loan can be rolled into the loan. Even if they can be, you might not want them to be. Find out how that affects your loan.
5. How much are your payments? Find out the exact amount of each monthly payment during the loan period.
6. What are the total number of payments you’ll be making? If you enter into a five-year loan, that’s 60 payments. A four-year loan consists of 48 payments.

When you’re ready to finance the purchase of a new vehicle, be sure you ask lots of questions. Find out the true cost of your car financing.

 The following types of insurance are the basic types of insurance for automobile owners.

• Liability Insurance – Usually, liability consists of two parts – body injury and physical damage. Both types of liability insurance are there to protect you and drivers and passengers of vehicles involved in a vehicular accident with you. This type of insurance covers any damages that you may be responsible for.
• Collision – Collision insurance covers damage to your own vehicle in the event you have an accident without another party or you are at fault.
• Uninsured and Underinsured Motorist – These types of insurance help cover any damage to your vehicle when a negligent driver does not have enough, or no, liability insurance.
• Comprehensive Insurance – If your vehicle is in a hail storm or receives other, non-accident-related damage, then comprehensive insurance can cover the damage.

In most states, it is illegal not to drive on the roads without at least liability insurance. You have to prove financial responsibility. Many finance companies that underwrite auto loans require collision, full coverage, or comprehensive insurance as well. Talk to your lender to see what the necessary insurance provisions are for your loan.

• Pay cash
• Make a trade
• Monthly installments
• Borrow money from a friend or relative
• New car financing

Paying cash might seem like the best way to purchase a new car, but unless you’ve got $15,000-$30,000 laying around it’s probably out of reach for you. Many people like to pay cash and that’s fine, but they likely buy used cars and usually buy from individuals. Those automobiles could have serious mechanical issues so you’re always on a “buyer beware” notice.

Many car dealers allow you to trade in an older automobile for a new one, but you still end up owing for the difference between your trade-in value and the retail value of the car you’re buying.

Some car dealers allow you to purchase on a monthly installment plan. Those car dealers are usually tote-the-note lots and you end up paying more than the car is worth. You still have to pay interest and the cars typically start out with a price tag higher than the real value of the automobile.

Most people don’t want to borrow from friends or relatives. That can often complicate your relationships.

New car financing works for many people because you know you are getting an automobile that is worth the price tag, there are fewer mechanical problems, and a new car is still under warranty. Financing a new car is less risky than other methods of purchasing a car. That’s why it is offered and that’s why car buyers use it.

Some specific information to look for that your auto loan lender will likely disapprove your loan for are:

• Negative judgments such as liens, auto repossessions and consistently late payments
• Too much debt relative to your income
• A large volume of revolving credit

If you have a mechanic’s lien or an auto repossession on your record then your auto loan lender will likely not approve you for a new car loan. Those are red flags that are difficult to get past. Clean up your record before applying for a new car loan and you will increase your chances of getting that loan. Make sure that you make good on all your payments for any outstanding loans for 6 months to a year before applying for a new car loan. Consistently late payments will not look good and could result in you having higher car payments or a higher finance rate, if you get the loan at all.

Likewise, if you have a high debt-to-income ratio then that will not go favorably for you. Reduce your debt before applying for a loan.

Another thing that will count against you is a lot of revolving credit. This is debt that has no set number of payments. For instance, credit card debt. If you have a lot of such credit on your report then you will appear to be a high risk and the auto lender will not give you a loan.

Make sure you clean up your credit report before applying for a car loan. You’ll stand a better chance of getting your financing.

4 Types Of Auto Loans

• New Auto Loan – Vinart can put you in touch with a finance counselor to assist you in setting up a new car loan. Fill in the application, get your credit checked and drive your dream car off the lot.
• Auto Equity Loan – If you do not qualify for a new car loan, don’t sweat it. Take out an auto equity loan instead. If you own a home and have equity in your mortgage then borrow on that equity and get the car you want.
• Refinance Loan – For car owners who are currently financing, there is a unique type of loan. It’s called a refinance loan. These loans are designed to restructure an existing loan to get you a lower interest rate or lower monthly payment.
• Lease Buyout Loan – If you are currently leasing your Vinart vehicle and want to buy out your lease but can’t afford the cash then take out a loan from an auto lender and make your monthly payments. You win two ways – you get to own the car you are currently driving and you get it paid for.

Vinart tries to accommodate the needs of all drivers and car owners. We want you to have the car of your dreams so we make sure you have access to every type of loan we offer.

OK, you might have to jump through a few more hoops to get a car loan after going through a bankruptcy, but it’s not impossible. Generally, auto lenders want you to have a history of stable employment, a down payment, no previous auto repossessions and enough income to be able to handle your car payments. If you can prove that you can make your monthly payments and that you meet the other loan qualifications then you should be able to get a car loan relatively easy. A large down payment will help.

You want an income of at least three times the amount of your car loan, but four times is better. For instance, let’s say that you are applying for a car loan that will set your payments at $400 per month. You want your monthly income to be at least $1,200 per month. If you have a monthly income of $1,600 then that is even better.

As well, if the vehicle you are expecting to purchase is going to cost you a total of $5,000 then you want to lower your loan amount as much as possible. If you have a bankruptcy on your record then you want to put down at least $1,000 toward the purchase. That will mean that you’ll be financing $4,000. If you can put $1,500 or $2,000 down then you’ll increase your chances of getting the loan.

It’s very important that you not have a repossession within the past year unless that repossession was a part of a bankruptcy. If that is the case then be sure you disclose that to your lender right up front.

You also don’t want to apply for a car loan too soon after your bankruptcy. If you are applying for a car loan the next month after your bankruptcy then it will appear that the bankruptcy wasn’t necessary and you may be suspect of fraud. Try to wait at least six months.

It’s not impossible to get a car loan after a bankruptcy, but you do want to make sure your finances are in order and that you can demonstrate an ability to pay off the loan.

However, understand that just because you got your quote in writing doesn’t mean that you are guaranteed those quoted rates. If you wait too long then the rates will go up and the quote is no good. If, for instance, you waited six months then you waited too long and you’ll need a new quote in writing.

By getting your auto loan quote in writing you protect yourself and your lender. No one can say that the deal you want to agree to is not a valid deal. A good auto loan quote will have the date of the quote in writing, the amount of the proposed loan and the interest rate. It should also include other pertinent details like the total price of the car you are buying and the make, model and year of the vehicle. This ensures that your loan applies to the specific vehicle you want to purchase.

An auto loan is an important business agreement. You need to understand all the details before you agree to it. Get it in writing.

Actually, you can. But it plays out a little differently.

Since your auto loan is usually underwritten by an auto finance corporation or, in some cases your dealer, then there are fewer hoops to jump through to refinance your auto loan. You still need to undergo a credit check. If that checks out to the satisfaction of your lender then you could very well refinance your auto loan in a short time.

The benefit to refinancing your auto loan is that you can lower you car payments. The ideal time to do it is when interest rates are low, which will give you a better rate on your loan and make your car loan easier to pay over time. You could, in some cases, lower your car payment without extending the life of your loan.

But you don’t always have control over situation that requires financial rearrangement. If you need an auto loan refinance then you need it when you need it.

If your car loan payments are too high then now is the best time to refinance. And just so you know, you don’t have to keep the same lender. You can refinance under a different auto loan financing company. The main thing is that you lower your car payments.

Two great resources for helping you determine your used car’s value are N.A.D.A. and Kelley Blue Book.

There are two types of value with regard to selling your vehicle. There is trade-in value and private party value. Your trade-in value will be much lower. The private party value is the retail value of your used car. If you are planning to trade your used car in for a newer vehicle then consider those values because the auto dealer will not give you retail value. One advantage to selling to a dealer, however, is you can usually sell it much more quickly than if you tried selling your car to an individual.

The most important thing you’ll need to learn to do in determining the value of used cars is judging condition. A good vehicle will be worth more than a vehicle in poor condition.

Used car buyers want to know how available parts are for the vehicle they want to purchase. For that reason, common vehicles are more easy to sell than exotic cars. But in terms of value, a classic vehicle can often be valued at more due to its collectible status.

If you have trouble determining your used car’s value then take it to a dealer and ask for an appraisal. Most dealers will do this free of charge if you are planning to trade your vehicle in for a newer model.