When interest rates are climbing, it probably seems impossible to get any type of good rate – especially when financing an auto loan. But it’s not. If you take advantage of a few great tips, you might just find that you’re the only one with low rates in the midst of a high-rate storm.
Try Low Dealer Financing
While in general, dealerships don’t offer the lowest rates when financing a car loan, depending on which one you visit and at what time, you may stumble upon a very low APR (maybe as low as 0 percent) that can help you through at least the first few years of ownership. However, keep in mind that these deals very often result in a contractual rate hike. If this occurs, you may want to take advantage of refinancing with a bank when the time comes to once again lower the rate.
Refinancing Your Current Car Loan
Refinancing is usually a pretty good way to take advantage of lower interest rates. As mentioned previously, you may be able to refinance if the time comes for a rate increase. However, you can also take advantage of it if your credit report was not so hot when you first financed the car, yet it is improved and so is your chance of acquiring a lower rate.
Home Equity Loan
Taking out a home equity loan is another alternative that you might consider when financing an auto loan. In this scenario, you can take out a loan against the equity you already have in your home. Because you’re working with your mortgage company instead of a dealership, you may be able to secure a great rate for your loan.
The pre-qualified loan is also an alternative to consider. Because you are offered a low fixed rate in this scenario, you can usually lock it in even before you head to the dealership.
***If you think financing an auto loan has to be expensive in some circumstances, you’ll be happy to know this isn’t entirely true. By learning how to take advantage of the climate you’re in, you can secure lower auto interest rates than you could have ever imagined.***