The car buying experience should be an adventure. But before you get down to the exciting details, you have to get the money straight. Here’s how to apply for a car loan.
The first thing you are going to want to do when applying for a car loan is find out your credit score. Most credit card companies now print your credit score on your statement but you can also get it here. Your score will largely determine your interest rate, so make sure it is what you expect it to be.
Next, decide what you can afford. A good rule of thumb to follow is that you shouldn’t pay more than one-fifth of your monthly income on your car loan. Bear in mind, there will be fuel costs, higher fuel costs for performance vehicles, insurance premiums and upkeep. Some people get so excited about a new vehicle that they don’t factor these costs into their budget.
It’s also a great idea to get pre-approved for a loan. This means that you can shop according to your pre-approved loan amount. It can make finding the right vehicle a breeze!
For the actual application process, you will likely need a number of different documents. Make sure you have them in order. They are: proof of income, proof of insurance, proof of residence and credit history.
Be thorough with the application process. Getting the financial aspects of the process straight can go a long in way in ensuring a positive experience.