How to Shop for a Car Loan

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Male voice over - This is a sign of the times, empty showrooms, record losses for car manufacturers, sour news for them but good news for you if you are in the market for a car. But when you are shopping for wheels the dealer shouldn’t be your first stop at least if your plan includes borrowed money. Before you step foot in that showroom – financing first. Here are some simple rules for driving home the best deal on a car loan.

Step one – check out your FIO score because that will dictate how much interest you will pay. You can pay $15 for your actual score or you can use a calculator like to get an estimate online. Once you’ve got a handle on your credit score it’s time to shop for money you’ll often find your best deal at a Credit Union. Not a member? Maybe now’s a good time to join. Then compare that Credit Union rate with the ones you’ll find around the web. Or use a comparison site to shop for loans from several lenders at once – just be sure that it’s a site that shows you all lenders not just those who pay to be listed. And don’t just look at interest rates, check out the fees too. And remember to put down as much as you can and keep the loan as short as possible, both will lower the total interest you ultimately pay. You’ll also get better rates on new car loans versus used car loans.

Stacy Johnson – So check with the dealer but always be pre-approved before you step foot in that showroom. Once you’re approved you’re essentially a cash buyer and that’s always the best way to drive a hard bargain, from Money Talks I’m Stacy Johnson.