When you're getting ready to finally call your dream car your own, it's an exciting feeling. However, sometimes the experience may get a bit more confusing when it comes to financing. There's no reason that finances should get in the way of your enjoyment, though.
That's why, here at Lou Sobh Honda, we've made a list of things you can expect . Yes, financing can sometimes be confusing and unpleasant, but it doesn't have to be. Keep reading to find out how you can be prepared for this step.
What to do beforehand.
Probably the first thing you should do before financing your vehicle is find out the status of your credit score. The better your credit score, the higher chance you have of qualifying for a lower interest rate.
You should also figure out what sort of interest rates to aim for. Being informed on interest rates that other institutions can provide you will help with the negotiation process. Getting pre-approved can also help you save time during the purchasing process.
It's important to know what you can afford. Try to do this with your credit score in mind so that you can stay within your preferred budget.
What you need to bring with you.
There are four primary documents you need to bring with you when purchasing a vehicle.
1. Proof of income Be sure to bring copies of your pay stubs from last month as well as what you've been paid to-date the past year.
2. Credit and banking history This ranges from information about other outstanding loans or financial obligations you may have to how you've fared in the past financially. It could include mortgage or lease agreements, alimony or child support payments and credit card statements or bank statements.
3. Proof of residence Personalized mail or your mortgage statement are usually enough to provide reasonable proof of residence.
4. Proof of insurance Your lender will require proof that your insurance company is aware of your newly purchased vehicle and that it's properly insured.
If you aren't financing with the dealership, you will also want to bring along proof of your loan.
Know what determines the loan terms.
The majority of auto loans last from three to five years. Your lender will run a credit check and ask you income-based questions. Your interest rate will be determined based on how secure the lender perceives your finances to be. If you have a better credit score, manageable debt, a good standing with your insurer and a high income, you'll likely qualify for a lower interest rate. If not, you can plan what your monthly payments will be with a higher interest rate and try to make it as manageable as possible.
If you’d like to purchase a vehicle or want to know more about how to finance in Cumming, GA, drop by Lou Sobh Honda at 1105 Buford Rd, Cumming, GA 30041 for a test-drive. We look forward to serving our customers from Serving Alpharetta and Atlanta.