Real Estate

Archive for December 28th, 2011

0% auto financing means an auto dealership will give a car-buyer an auto loan without interest. While there is usually a down payment involved, the buyer will not have to pay interest on the amount borrowed. That’s right: 0% auto financing will provide a loan free of interest payments. This could seem like a great deal. But buyers need to know when zero percent financing works for their benefit and when it works against it.

Why zero percent auto financing is difficult to get: credit scores and loans.

Zero percent car financing is difficult to acquire because it’s usually offered to such a thin slice of qualified buyers. In order to qualify for any car loan, even one with zero percent, a borrower needs to have a good credit score. Only buyers with nearly spotless credit ratings can qualify. And even those buyers with some very slight tarnish on their credit scores could be refused.

Select vehicles and options often erase the 0% financing option.

Zero percent loans are only often offered as a financing option for the dealer’s choice of vehicle. Slower-moving vehicles are often tagged with the 0% financing incentive to move cars off the lot. This works fine for people looking for vehicles that aren’t selling well. But for buyers looking to buy a more popular vehicle, or for those searching for specific vehicle options, zero percent financing may not apply. While a dealer may be happy to provide someone looking for a car with, say, leather seats instead of cloth seats, the loan that previously didn’t have any interest may suddenly find itself coming with interest charges.

0% loans often discredits manufacturer’s rebates.

Auto dealers will often offer a 0% percent option to attract potential buyers to a dealership. When a buyer looks to capitalize on a manufacturer’s rebate as well as the 0% financing, the dealer tells her it’s one or the other. But this can sometimes work to the benefit of some borrowers. If your credit score doesn’t qualify you for the 0% auto financing, you can search out the manufacturer’s rebate and still save yourself money.

When it is time to buy your next vehicle, you have many auto financing options available to you. You can either finance your auto through a local bank or credit union, the dealership itself or with a pre-approval from an online auto financing company. There are several advantages to each one of these and several things you should also look out for.

The best auto financing that you can get is through your local bank or credit union. Their rates will be lower than financing your auto directly through the dealership or manufacturer. As a general rule of thumb, most banks will finance a new car at a lower interest rate and over a longer duration. Used cars, those models that are two years and older, usually get financing for only 36 to 48 months and with interest rates that are a few percentage points higher.

There are a few things you will want to think about before financing your vehicle through a dealership. First, make sure the financing the dealership is offering you is the best available financing you can get. In other words, make sure you have checked all other options. Next, be careful about all of the extras that come bundled with your vehicle purchase. The dealership or manufacturer is already getting the interest for financing the vehicle for you, so turn some of those extras into freebies since you have decided to finance through them. Whatever you do, don’t let the dealership convince you that you are getting a great discount from any factory rebates. These rebates go directly to the dealership so they will already get that money. Make them give you an additional discount towards your purchase as they will make it up later in the financing.

These days, receiving an auto loan with bad credit may seem like an unlikely dream. With a poor economy and a bad job market, what incentives to lenders have to give auto loans to borrowers with bad credit?

In reality, though, getting an auto loan with bad credit is a whole lot simpler than many people assume. The trick is finding the right kinds of lenders to do business with and making sure that the deal you accept is the best one available. You also need to know the important tricks to finding the right lender online.

Online Lenders: A Warning

Many people choose to go online in order to locate lenders for auto loans with poor credit. If you choose the right company, this is a really great choice. However, there are also a lot of dangerous scams online these days. If you have bad credit, auto loans are easier to find on the internet, but you will need to do a little leg work before you find them.

For most borrowers, this means your first stop should be the Better Business Bureau’s website. The BBB is a popular consumer protection agency whose goal is to untie legitimate businesses with legitimate customers. Through the BBB website, you can discover which lenders to avoid, which have offered better deals in the past and which are just flat out scams.

Picking the Right Lender: Look for the Signs

When searching the Better Business Bureau’s website for an auto loan lender, make certain that you stick with lenders whose grades are “B” or better and that you are on the lookout for some additional information. This, minimally, should include two key points on their website:

· Phone Number

· Physical Address

Though you will not need to visit the place in person, the fact that a lender provides a physical location is a good indication that they are both legitimate and accountable for their actions. Also, make sure that you call the number they list to check that (1) it is real, and (2) it is professional. If the person on the other end of the phone doesn’t identify him or herself and the company, find someone else to give your business.

To finance a used car with a lien is not that difficult and is a pretty common occurrence now days. This is because most people have a lien on their car when they go to sell it. Gone are the days that someone pays off their car and keeps it until it dies.

Let’s begin by explaining what a lien is…

A lien is a put on a piece of property, in this case a vehicle as assurance that the borrower will pay the debt in full. It is a form of security for the lender.

When anyone finances a car, new or used the bank places a lien on the vehicle until it is paid in full. This gives the lender the right to the title also. Once it is paid in full the lender releases the lien and the borrower owns the car outright.

Now you will become the holder of the title.

Buying a used car from someone who owns the car outright and is the holder of the title is definitely an easier choice but there are times when it simply isn’t possible.

So, if you have fallen in love with a vehicle that you simply must have but it still has a lien on it, let’s take a look at how to finance a used car with a lien.

If you’re buying from a private seller…

Never hand over cash to the private seller that still has a lien on his or her vehicle they are trying to sell. This is because you have no guarantee that the person will pay off the loan releasing the lien.

If they don’t pay off the lien…

You are out double; you have lost your money and you cannot legally own the car.

Begin by speaking with the person who is selling the car. Discuss which lending institution holds the lien on the car. Ask how much he owes on the balance of his loan.

You will want to know this information.

If the seller owes more that what the vehicle is worth you will want to know how the seller is going to pay the balance off.