Tips to Lower Your Car Loan Interest Rate (1)

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Tips to Lower Your Car Loan Interest Rate
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• Owning a car is a necessity in todays world.
  When you have your own vehicle, things just
  become easier. However, no matter how efficient
  it is, getting a car is an expensive affair. The
  cost itself is enough to burn a hole in your
  pockets, and the maintenance of the car serves to
  cut the hole deeper. Add to this inflation and
  rising fuel prices, and there you have it a
  recipe for financial ruin. To help ease the
  burden out, you can always opt for financing from
  a bank. However, if not backed with proper
  research and care, a car loan can also harm your
  financial plan. To get the cheapest deals on your
  car loan interest rate, follow these tips -

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Credit score

• Also known as CIBIL score, this is one of the
  most important element that determines your
  interest rate. If you have a high credit, you
  will receive the lowest interest rates possible.
  But banks will offer you a higher rate for a low
  credit score as it shows your questionable
  repayment history. So, its advisable to tighten
  up your credit score. If your score is not high
  enough, wait until your score increases.

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Refinance

• Most customers are unaware that just like with
  home loans, they can also refinance their auto
  loan. In a refinanced loan, the old loan is paid
  off with a new one. It serves to not only lower
  the monthly payments, but also reduces the
  interest amount you're paying which allows you to
  pay off your car sooner. Since cars depreciate
  quickly, it is essential that you finish off your
  loan quickly.

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Small loans

• Dont apply for small loans. If you only need a
  few thousand rupees, its pointless to apply for
  a car loan. Small loans can be paid off much
  faster. However, they often have higher interest
  rates than larger loans. Thus you end up spending
  more on premiums than you would otherwise.

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Dealerships

• Dont get financing quotes from your dealer. Car
  dealers are mostly middlemen, trying to earn
  their bucks. A quote from them will make you
  somehow paying more than you would pay normally
  if you do your own research for loans.

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Compare

• Dont settle for the first deal that you come
  across. The market is flooded with car loan
  offers. Choose one that sticks to your budget and
  suits your needs. You can take the help of online
  EMI calculators for car loan, to get an estimate
  of how much youll be expected to pay. This
  knowledge will help you make a sound financial
  plan.