Avoid These 3 Costly Car Loan Mistakes
Three Costly Car Loan Mistakes
Car buying often comes with stress! We've been in the auto lending business for decades and have a few tips to share when it comes to buying your next car. The next time you are car shopping, we encourage you to keep your overall financial health in mind. How can you do that?
Know Your Credit Score And Budget Before You Go.
Don't head to the dealership without knowing two critical numbers: Your credit score and your approved loan amount. It's a dangerous game to enter a dealership in the dark and allow them to define your creditworthiness. Shopping in the dark can lead to being pressured to buy more than you can afford and enter into a loan with a higher interest rate and higher fees than you can find elsewhere. You may also be tempted to shop by "monthly payment" versus the overall cost. Utilize your credit union membership and get loan pre-approval before you car shop. We can help you determine the loan amount, rate, and monthly payment that fits your financial health before you even step on the lot.
Avoid Getting Upside Down.
If you owe more on your current car than what it's worth - we encourage you to resist the temptation to roll the negative balance into a new car loan. Where possible, pay extra on the current car until you can build equity in your vehicle or break even.
Get The “Extras” From A Trusted Source.
When purchasing products such as Payment Protection, Gap Insurance, and Extended Car Warranties, we encourage you to research your options. While these products are often sold through the car dealership, they may include a high markup. When you get a loan through the credit union, you can add these at a much lower price as a benefit of your membership. We encourage you to research your options.
Ready to car shop? Let us help by helping you determine your pre-approval amount. At HCP Credit Union, every day we help members review their loan options and save them money. We do not charge auto loan application fees.
Please apply online or give us a call.
Use our local car shopping tool to find your next car.
*Loan rates and approval are based on credit rating and underwriting criteria.