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How to get a great deal on a car loan in Acton

How to get a great deal on a car loan in Acton

If you have an Acton car loan or are thinking about buying a new car, there are some things you need to do if you want to enjoy the lowest possible interest rate.

Not all car lenders are created equal

The first thing you should keep in mind when shopping around for a car loan in Acton, is not all of them are created equal.

Each one sets their respective loan underwriting requirements so where one lender will say “no” another will say “yes”.

Universal things all lenders look for in a prospective borrower

There are a few universal things that all lenders will look at when trying to determine whether they will offer a loan.

The first is whether you have a stable source of income that covers your current obligations plus any new loans you take on.

Most lenders will not lend more than 40% of your debt-to-income ratio, so if you were making $5,000 per month your total debts cannot exceed $2,000. Each lender will set its requirements, so just use this as a baseline.

Lenders will need to see proof of income which can be in the form of salary slips from your employer. If you are self-employed then bring your bank statements and income tax assessments for the last two years.

Aside from having a verifiable income, the next thing that the lender will need to review is your credit score. You can access your credit score for free by going to Credit Karma.

Your credit score needs to be over 680 to qualify for prime interest rates. If your score is under 680 then you have some homework to get your score back over 680. (You can still get a car loan even if your score is under 680).

Causes of a low credit score

A common cause of low credit scores is missed payments. If you miss a payment, your credit score will tumble and it will take months to recover. You should always make your payments on time and if you are the type of person who forgets, (there is nothing wrong with that), then you can sign up for pre-authorized payments for free.

If you make your payments on time without fail, then your credit score will climb but it will take time which is something you may not have.

Buying a car in Acton

While working on improving your credit, you should also try to get a car loan ASAP. The shortage of new and used cars is going to last for years and things may never go back to the way they were before the pandemic.

It would be prudent on your part to reach out to your local car dealership and start booking test drives. The dealership is able to get you approved by leaning on its extensive network of lenders throughout Canada.

These dealerships can also help you repair your credit so you save money on interest payments going forward but the first step is you reach out for help.

We all need a car to lead a normal life in Canada, so do not delay reaching out and applying for a loan.

When you’re ready for a car lease or loan, get in touch with the Acton auto loan experts at Northway Ford for great deals on auto finance.

Categories: Car Loan

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