Getting a Great Interest Rate On Your Car 

When it comes to financing a vehicle purchase whether it is New or Used, is getting the best interest rate that you can for your credit situation. The Interest rate can save you a considerable amount of money over the term of the loan. When it comes to your interest rate there are some things to consider that can have an impact on the rate which you can qualify.  

Your Vehicle Choice :

The first difference would be if you are buying a New or Used Car. In most cases regardless of the lender the Interest Rate will be ½ to 1% higher for a Used Car vs. the New Car. You will want to check with your lender, because most lenders have limitations on the age of the car and the amount of miles on the car. They will also limit the term of the loan based on the age of the car.
 If you are buying a New Car you may be able to get Special financing programs that offer low rates through the manufacturers financing division. These programs also require your credit score to be within a certain range. 

The Lender:

When you finance your vehicle purchase it will be financed by a bank, credit union or the Manufacturers finance division. All of these lenders will be influenced by the current market conditions, such as prime lending interest rate. The manufacturers finance division may be offering incentives or special financing; if they do not have special rates of your vehicle of choice they are usually very competitive with any bank. Many times they may even be a little more aggressive on the interest rate in order to sell a vehicle. Credit Unions can be a great source for financing a vehicle when there are not any manufacturer special rates. Credit Unions many times will have little lower rates than a bank. Credit Unions will usually require you to be a member, although I have seen some Credit Unions recruiting new members by financing the vehicle purchase.  

Your Credit:                                           

 The item that has the most impact on your interest rate for your vehicle purchase will be your credit score and history. Not all buyers and not even a majority of buyers today can qualify for the special interest rates from some manufacturers. When a buyer can’t qualify for a special interest rate there is many times a rebate that can be used against the purchase price instead of the promotional financing rates. Make sure check on the specials. For example they may say (1.9% financing or $2000.00 rebate). With that scenario, if you did not qualify for the 1.9% financing you can get the rebate. Your interest rate would then be determined by your credit. 

Remember, do your homework before you go to the car dealer. The savings could be in the thousands of dollars.