This is a loaded question i have been asked not hundred of times through the years but many thousands times and it really branches out with many different answers, here are some answers the average consumer was not aware off
New cars
...as an example lets say a vehicle is $ 49.495. and the dealer says 0% financing, well lets look a little closer at the overall picture that is you have not read the fine print as most consumers dont.0% - 24 months
( thats great if no money up front and you can afford heavy payments )3% - 36 months ( nice rate but still heavy payments )
5% - 60 months ( i am starting to like the payments, but what happened to the interest rate )
Most financing incentives at zero% or example 2.3% are for a short term, and that makes monthly payments very high, if you arranged you own financing then in many transactions there is a Mfg rebate, my point here is nothing in this world is free
Buying down Used Car Rate
You have done all your homework and know what interest rate is fair shopping for a car and you come across a dealer offering interest rates a notch or two below average.?
Dealers know how to press that emotion button dealing with smart shoppers shopping interest rates as one of the main factors buying a car.
Don't
ask whats your Interest rate ?"- You are telling the salesperson that the interest rate will come into play in your decision making. Some lenders will allow for a dealer to buy down the rate and if a point or two below average triggers your emotions, you are hooked. " example " the dealer pays $800. towards the Interest to the lender up front and the rate now drops 2 points.The $800. will be hidden in the negotiation stage, in other words had the Interest rate not been a factor to close the deal then there would be $800. more on the table that could be negotiated..
You dont ask the dealer what their Interest rate is before having finalized a price, you have a rate in mind and it now comes time for dealer to match your expectations or you shop for your own financing.
Here's a look at credit scores among the US population
Up to 499: 1%
500 - 549: 5%
550 - 599: 7%
600 - 649: 11%
650 - 699: 16%
700 - 749: 20%
750 - 799: 29%
Over 800: 11%
Credit scores (usually) range from 340 to 850. The higher your score, the less risk a lender believes you will be. As your score climbs, the interest rate you are offered will probably decline.
Excellent - 750 - 850
Good 660 - 749
Fair 620 - 659
Poor 350 - 619
Whats Your Credit Score
Having a blemished credit score compared to an excellent credit score is like driving a Hyundai when you could be driving a BMW for the same monthly payments.
You pay your bills on time and figure your in good standing when you apply for a loan, without knowing your actual credit score you could be accepting terms at a higher rate as your report card may show error that needs to be removed.
You see advertised on the Internet FREE credit reports " yer right " nothing in this world is free without a catch, my choice is " Consumers Direct " you sign up for the free trail offer and can cancel within the trail period without any hassle, their catch is you will most likely love the service and stay a member.
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