3 Important Signs of a Good Auto Loan Company Online
You can get auto loans from various types of lenders, like banks, credit unions, auto dealers and auto manufacturers, and now online auto lenders. Don't pass up an opportunity to get a great loan online that might save you money and will certainly save you time and hassle. Here are 3 signs of a good online auto lender:
1 - A Competitive Interest Rate
Getting an auto loan online should save you about 1 to 2 percent over getting a loan from your auto dealer. Furthermore, online lenders should be competitive with your local banks. When applying with an online auto lender you will often get multiple rate quotes with one application. Always compare the rates and the fees together. More often than not the larger the down payment you give the lower the interest rate will be.
2 - Fees and Charges
Avoid lenders, online or otherwise, that have a long laundry list of fees and charges. These charges have names like application fee, credit score fee, and document prep fee. Try to avoid these fees any time you can, many lenders will waive or reduce these fees if asked. A competitive online auto lender will only charge fees that are being charged by every other lender. Knowing what is normal and what is appropriate by way of fees, can only be learned by getting multiple offers from various online lenders. Shopping around isvery important!
3 - Avoid Prepayment Penalties
Auto loans are generally cheaper than most other types of loans because the lenders use your car as collateral. That being said, the interest rate is rarely as low as a home mortgage rate and unlike your home, the interest you pay on your car is not tax deductible. Therefore, you should pay off your car loan as soon as possible and so you need to avoid auto lenders that have prepayment penalties. This could cost you extra money down the road. Many auto lenders online will eliminate this clause simply by asking.
As you search online for auto loan companies, make sure they have good customer service. Look for any feed back on blogs or ratings websites. You should feel like your loan is priority with this lender. Your credit score should not be an excuse for them to gouge you financially.
Getting an auto loan online should save you about 1 to 2 percent over getting a loan from your auto dealer. Furthermore, online lenders should be competitive with your local banks. When applying with an online auto lender you will often get multiple rate quotes with one application. Always compare the rates and the fees together. More often than not the larger the down payment you give the lower the interest rate will be.
2 - Fees and Charges
Avoid lenders, online or otherwise, that have a long laundry list of fees and charges. These charges have names like application fee, credit score fee, and document prep fee. Try to avoid these fees any time you can, many lenders will waive or reduce these fees if asked. A competitive online auto lender will only charge fees that are being charged by every other lender. Knowing what is normal and what is appropriate by way of fees, can only be learned by getting multiple offers from various online lenders. Shopping around isvery important!
3 - Avoid Prepayment Penalties
Auto loans are generally cheaper than most other types of loans because the lenders use your car as collateral. That being said, the interest rate is rarely as low as a home mortgage rate and unlike your home, the interest you pay on your car is not tax deductible. Therefore, you should pay off your car loan as soon as possible and so you need to avoid auto lenders that have prepayment penalties. This could cost you extra money down the road. Many auto lenders online will eliminate this clause simply by asking.
As you search online for auto loan companies, make sure they have good customer service. Look for any feed back on blogs or ratings websites. You should feel like your loan is priority with this lender. Your credit score should not be an excuse for them to gouge you financially.
