Car loan rates are one of the biggest topics for anyone intending to buy a car. It’s not hard to tell why: The monthly rate is possibly the most direct indication of whether you’ll be able to afford a car or not. No wonder, then, that the web is virtually swamped with car loan rate calculators, recommendations on how to get the best deal and companies trying to convince you they have the best car loan rates anywhere in the UK.
For anyone interested in getting a good deal, this may simply be too much information. Which is why we have put together an overview of the most important things you should take into consideration.
Car loan rates: Now may be the time to buy
One thing’s for sure, however: Now is certainly not the worst time in the world to start looking for a car loan. After all, with savings rates at a historical low all across Europe, it simply doesn’t make much sense to put your money on the bank and wait for it to magically multiply.
What’s more, car loan rates are at a very reasonable level at the moment, both for regular credits as well as bad credit car finance. If you really need a new vehicle, therefore, there’s no need to delay.
Car loan rates: What determines your rate
Sometimes, car loan rates can be confusing. What, exactly, determines how much you’ll need to pay? Why do some buyers get more favourable conditions than others?
Here’s a list of the most important factors for car loan rates:
- The general rate of interest: With general interest rates at a low, there is a definite potential for car loan rates to go down as well. Which means you may be able to get a favourable deal.
- Your credit rating: Unfortunately, credit ratings are pretty vital when it comes to determining car loan rates. Fortunately, there are various steps you can take to improve it.
- The dealer: Different dealers can have very different conditions, even within the same city. Explaining these differences can be something of a mystery, but you should at least be aware of them.
- The car in question: It makes sense that very attractive cars can yield higher car loan rates than less trendy ones. It also matters whether you’re buying a new or used car – although the difference in rate between the two has gone down over the years.
- Your negotiating skills: Contrary to what you may think, you actually have some leverage. The market for car loan rates is highly competitive and it may be better for a dealer to give you a slightly less expensive rate than to lose you as a customer altogether.
Getting a car loan: What to watch out for
As you’ve seen, two out of these five points for determining car loan rates relate to the dealer and your rapport with him. This obviously also means that you’ll need to be careful and avoid some of the most common traps.
Here are some of the most important things to watch our for when looking for car loan rates:
- Car loan rates should only relate to the car you’re buying. Very often, however, dealers will try to sneak in various other products and sell you insurances or services. Whether or not these make sense is another question, but it definitely comes recommended to keep things clearly separated from each other.
- If you want to compare car loan rates from different dealers, you’ll need to make them comparable first. The monthly car loan rate is the least important thing in these calculations. What really matters is the actual rate, since this is what ultimately determines how much you’ll have to pay back.
- It definitely makes sense to know your credit rating before entering into negotiations with a sales man. Also, make sure to prepare suitable explanations for your current financial status and to be able to demonstrate that you’re willing to improve if you should have run into financial difficulties in the past.
Car loan rates at CCC
At Concept Car Credit, we try to focus on two things: Giving you great and fair car loan rates even if you should have a bad credit rating and allowing you to choose from a breathtaking collection of cars. After all, what use are low car loan rates if you can’t get the vehicle you need or want?
Talk to us now for any questions or simply drop by our showroom in Manchester. We can’t wait to show you what we have in store.