Shopping for a new vehicle can be overwhelming on its own without even considering the auto loan application process. But if you don’t take the time to research and compare auto loans, you may end up with a bad deal.
Before you begin to shop around for the best deal, check your credit report. Your overall credit will give you a general idea of what interest rates to expect. You should also consider your budget and how much you can afford to spend each month on vehicle loan payments. It’s important to make a purchase that you can afford. If you fall behind on loan payments, your vehicle may be at risk for repossession. A vehicle repossession negatively affects your credit for up to seven years. You should also keep in mind that shorter term loans will mean that you pay higher monthly payments, but less over the course of the loan.
When you apply for an auto loan, your credit score will take a slight hit. The credit bureaus will treat several loan applications made within a short time frame as a single application. If you were to receive credit denials from several potential lenders, your credit report could be impacted negatively and your credit score may drop.
Seek Legal Advice
Flitter Milz is a consumer protection law firm that represents victims of vehicle repossession. If a borrower defaults on a bad auto loan and the vehicle is repossessed, Flitter Milz will evaluate whether the lender violated the borrower’s consumer rights. If your vehicle has been repossessed in the past six years, Contact Us for a free evaluation.