Posts Tagged ‘loan term’

Lenders defy Conventional Norms by offering 8 Year Term on New Car Loans – Is it worth it?

Cars and car loans have become equivalent. If you want to buy a new car, an auto loan has become a complete necessity. With growing need of auto financing and increasing competition in the car loans market, lenders are constantly trying to innovate. Past several years have seen pioneering ideas like no money down auto loans and no co-signer car loans. This year has been no different in terms of innovation because lenders have brought highly unconventional “8 Year Loan Terms”.

Auto lenders have become increasingly enthusiastic in offering car loans with unexpectedly longer terms. Experian Automotive March 2013 report divulged information about the average loan terms. The average terms have increased to an all-time high of 65 months. And, now the experts are predicting that 96 month loan term will become popular.

Why are Loan Terms becoming longer?

The report also disclosed the rise in new car loan amount. The average new auto loan amount for Q4 2012 has increased by $272. This shows that car prices are rising steadily which makes it difficult to buy a new car. But, if the new car sales dip, it would affect the automobile industry. So, lenders have started offering longer terms to help Americans fulfill their new car dream.

Also, there is a growing appetite of consumers for car loans. The current economic period is better compared to the recessionary years. Credit borrowers have performed exceptionally well in making regular payments. This allows the lenders to have faith in car buyers.

Benefits of Longer Car Loan Terms

Buying your Dream Car

It is not possible for everyone to buy a new car because of high monthly payments. But, longer terms ensure affordability. This gives you the opportunity of buying any car you want.

Lower Payments

If you opt for shorter term, you have to deal with high payments. But, longer loan terms allow you to lower your monthly payments. This means you will experience considerable ease in making payments. An example will make things clear. If you buy a car for $35,000 at 4% for 4 years, monthly payments will be $790.27. And, if you extend the term to 8 years, payments will be approximately $426.62.

Regular Payments can improve your Credit Score

A 7-8 year loan term is a big responsibility. If you are able to make regular payments, your credit score will definitely increase. It will also show other lenders of your commitment and financial capacity.

Problems with Extended Loan Terms

Pay More towards Interest

Longer loan terms give you flexibility by offering affordable payments. But, you have to pay a price for it. Over the entire term, your total interest amount will be on the higher side. Let’s use the same example of $35,000 car at 4% for 4 years and calculate your total payment towards interest. It will be $2,932.81. And, if you opt for 8 year loan term, it will be $5,955.97. This means you will have to pay $3023.16 more.

Higher Chances of Upside Down

A car is a negative asset because its value decreases over the period of time. The depreciation rate of a new car is phenomenal which means there are higher chances of an upside loan. If such a car is stolen or is involved in an accident, the insurance amount won’t cover your loan amount. This will be detrimental to your financial condition.

Maintaining your Car

If your car has warranty, your maintenance cost will be low. But, when you opt for 8 year loan term, your car will not have any warranty in the last few years. This is because most new automobiles come with warranty of 3-5 years.So, your maintenance cost will increase in the future.

Every innovation has its pros and cons. And, its importance is going to be different for every individual. So, think through and decide whether “8 Year Loan Term” is a stunning opportunity for you.

Best of luck in choosing the best new car loan term!!!

Be the first to comment - What do you think?  Posted by Rock Watson - July 6, 2013 at 4:37 am

Categories: Articles   Tags: , , , , , , , ,

How to secure No Money Down Auto Loans for People with Bad Credit?

As cars are becoming a necessity for us, the importance of auto loans is rising. When someone applies for a car loan, it’s obvious that he has no ready cash for buying the car. This means making a down payment also becomes difficult. The good news is that you can avoid money down by opting for no down payment car loans. This car financing program is perfect for everyone including people with bad credit.

Is it Possible to get No Money Down Auto Financing with Bad Credit?

Yes. You can easily get approved for no money down car loans for bad credit. All you need to do is ensure the lender of his financial investments. If he considers you a less risky credit borrower, instant approval and guaranteed low rates will be a reality for you.

How to get Guaranteed Approval on No Down Payment Auto Loans for Bad Credit?

These tips will help you get easy approval no down car loans. Bad credit will cease to be a problem when you follow these suggestions. Try and use the maximum of them to enjoy low rates and lower car loan cost.

Co-Signer

A co-signer lowers the risk factor. It is because the lender knows that he can recover his money if you stop making payments. So, start your search for a co-signer today.

Income Proof

Having sufficient income to pay-off car loan is one of the important criteria. You can show your pay-stubs or tax returns as income proof. This way lender will be sure of your regular income and also, regular payments.

Inexpensive Car

Choosing an inexpensive car means reducing your car loan amount. And with the reduction in loan amount, lender’s risk also reduces. This way your approval chances become brighter.

Trade-Ins and Rebates

You can avoid down payment by trading your old car. Ask the dealer to deduct the value of your old car from the car loan amount and forget putting money down. You can also make use of rebates for the same purpose.

Shorter Loan Term

If you opt for a shorter loan term, it means you will be able to pay-off the loan before the end of useful car life. This is perfect for everyone because the risk of upside down car loans reduces substantially.

Choosing the Lender

You certainly don’t want to waste your time in applying with lenders who won’t offer you loans. So, start your research for lenders who offer no down car financing programs to individuals with bad credit ratings.

You can make use of internet for searching sub-prime lenders. They work with bad credit borrowers and have no trouble in providing car loans without down payment.

You can select a reputed online car financing company for loans. They have a huge network of lenders and dealers which makes it easy for them to guarantee quick approval on no money down auto loans for bad credit. Don’t forget to check the reputation of the lender/auto financing company before filling the application form.

All these tips will definitely help you in securing no down payment auto loans. When you follow them, it will make your car loan application stronger and lenders will be compelled to look beyond your credit score. So, don’t forget them during the car financing process.

Rapidcarloans.net offers affordable auto loans for bad credit borrowers. People with bad credit score can enjoy no money down car loans by applying on the secure website. Apply now to enjoy low rates and 100% free car loan quotes.

Be the first to comment - What do you think?  Posted by badcreditcarloans - November 10, 2012 at 7:27 am

Categories: Services Offered   Tags: , , , , , , , , , , , , , , ,

Great Tips to Choose a Car Loan

Buying a car is fun when you know you have got the best car loan deal. Take a wise car loan decision by knowing every aspect of financing your dream car. Read to get a complete understanding of the many car financing options available with you.

Read more...

Be the first to comment - What do you think?  Posted by Alan Hendricks - March 3, 2012 at 10:35 am

Categories: Services Offered   Tags: , , , , , , , , , , , , , , , , , , , , ,

Bad Credit Car Refinance – Get A Better Replacement of Your Loan

Everyone is dealing with credit issues. Lenders, who once financed all and sundry, have become so selective that an average credit score is not enough for them. So, a bad credit score is absolutely out of question.

Stringent lending norms and a bad credit score made you a sitting duck for dealers. But, this doesn’t mean you are stuck with high interest rates for the rest of life. The 43rd US President said that America is land of second chance. And, it surely is.

You can have your second chance by refinancing your auto loan. Remember, that your bad credit record is just a history and nothing more. There are still few lenders who are interested in giving you that second chance.

You have the opportunity of paying off your loan with a new low interest loan. A bad credit score sure compelled you to opt for higher interest rates, but things can change now. Bad credit car refinancing can free you from the vicious circle of high interest rates – high payments. It is a simple process and has the potential to save loads of money.

The loan term is also a bit longer so that it becomes easier for you to make payments. With bad credit car loans available, you are no longer required to avail an expensive personal loan for making payments.

There is another important benefit associated with refinancing. As the new lender will need few days to process you loan, you will actually get to skip your payment. Isn’t it great?

Now, Why Are Lenders Interested In You?

Does it sound too good to be true?

Well, lenders have a reason for it. They know that you are crazy for your car and won’t let it repoed. But at the same time, it is becoming extremely difficult for you to make such high payments. They know that you just need a low-interest loan. Lenders are assured that they will not lose money if they decide to refinance you.

When Someone Is Ready To Refinance You, Why Wait?

It is a misconception that you must at least wait for a year to look for refinancing options. There is no minimum waiting period or lock in period on auto loans. You can refinance your loan anytime you want it. The earlier you do, the better it is. An auto loan is designed in such a way that your early payments are directed towards the interest amount and so your principal amount won’t reduce considerably. So there is no point in waiting, is it?

Also, a car is a depreciating asset. So if you refinance it early, there are lesser chances of an upside-down loan.

Requirements

Unlike mortgage refinancing, car loan refinancing is less concerned with appraisals. There are no stringent inspections.

You will just have to specify the car’s year of manufacture and its mileage. Also a clean title is a condition. If you want to have a shorter loan term, the lender may even accept an eight year old car.

It doesn’t matter for the lender if you have had a bankruptcy or tax liens in past. A continuous employment with the same employer and regular payments will definitely improve your chances of approval.

Web – The Best Place

From pin to plane, internet is the best place to find everything. Use it to search for bad credit lenders. They also go by the name of sub-prime lenders. Fill in the simple application form and you will be able to generate several free car loan quotes.

Now, you must remember that you get the best deal only when you compare. A lower interest rate with a longer loan term is almost same as higher interest rate with a shorter term.

So, calculate the APR (Annual Percentage Rate). It will express the exact interest rate for a whole year instead of monthly payments and will be an effective tool for comparison. Take help of the online loan calculator to compute the exact benefit.

Once you find that flawless loan, don’t wait for long. Grab the opportunity and get going. Sign the dotted after scrutinizing the contract.

As you complete the documentation process, the new lender will pay off your loan and you will be able to make affordable monthly payments.

What Should Be Your Long Term Strategy?

Kudos to you!

You now have a low-interest loan. But don’t be satisfied with it. It is essential that you constantly work and improve your credit score. If you do so, you will be able to get that elite 0% financing.

A high credit score will solve almost all your financial problems. So, take initiatives to re-build it. Avoid unnecessary use of credit card. You must also restrict the number of needless inquiries on your credit report. Make payments on time and slowly your score will improve.

But, the immediate course of action is to hit the web and search for subprime auto lenders. Once you refinance your auto loan, you must concentrate on your credit score.

Smart car owners know that refinancing can help them in a big way, but smarter owners know the importance of credit score as well.

All the best!

Be the first to comment - What do you think?  Posted by carloanrefinancing - October 25, 2011 at 4:40 am

Categories: Services Offered   Tags: , , , , , , , , , , ,