How To Get The Best Car Finance Deal
Having a family means that you need a car that’s right for you with the right price tag. But how can you make sure you get the best deal possible when buying your next family car? There are a few factors that can affect the finance rate that you are offered and getting the right deal is important for any family.
1. Increase your credit score
If you’re applying for car finance, you will usually need to pass a credit check. Lenders use a credit check to take a quick look at your credit file and decide if they want to offer you finance. If you’re looking for car finance with bad credit, it can be helpful to improve your credit score before you start applying for finance.
Typically, people with better credit scores get offered the best rates and lower monthly payments. This is because they are seen as less of a risk to the lender. If you have had trouble in the past with meeting repayment deadlines, lenders may decline you for finance. There are many ways in which you can easily increase your credit score in the run up to a car finance application. You should always make sure you make any payments on time and in full and regularly keep your credit file up to date with the most accurate information.
2. Put down a deposit
Having a deposit to put down for your car finance deal can be really beneficial. Car finance deals such as Hire Purchase and Personal Contract Purchase sometimes do require you to out down a deposit for finance. But it can also help you to get approved for finance too. Having a deposit to put down for finance reduces the amount you have to borrow from the lender and can make tour application more appealing. It can also help to lower your interest rate and your monthly payments.
3. Use a car finance broker
Car finance brokers are a great way to compare car finance deals from a range of lenders without applying multiple times. A car finance broker acts as a middleman between the customer and the lender. They don’t charge any fees but instead make commission from the lenders. Brokers put car finance applications in front of a wide range of finance lenders and get the best finance package for the applicant. You can then take your car finance agreement to any FCA approved dealership and get the car you want within your agreed budget!
4. Part exchange your existing vehicle
If you’re a first-time driver, chances are you won’t already have a car to part exchange. However, having a current car to part exchange can help you get a better finance deal, even if you currently have outstanding finance. Lenders can use the value of your current car as a deposit for your new finance deal. This can help you get a better car than maybe you first thought. It can also help you to lower your monthly payments. Trading in your car at a dealership also means that the dealer can then sell on your car if it’s in good condition.