How To Get A Lower Interest Rate On A Car Loan?

Finance Paperwork with Glasses

 

Interest rates are inevitable when you take out a loan for a house or vehicle. Interest is a charge made by a loan lender to the borrower; this is calculated by a percentage of the amount loaned. 

Now, depending on your credit score, you can get a higher or lower interest percentage on a car loan, which is why many of our Clarksville customers ask, “how can I lower my car loan interest rate?”

There are many ways to do this and you can use these steps brought to you by the auto financing specialists at Music City Autoplex in Madison. Learn how to get a lower interest rate on a car loan by visiting us in person or applying for financing with our finance center to start the buying process today! 

Getting A Lower Interest Rate On Auto Loans

If you, like many Nashville car shoppers, are researching how to get a lower interest rate on a car loan, there are some steps you can take to do so. Usually, car shoppers aim for an interest rate between 3 – 5%, but depending on your credit score, whether good or bad, this could vary. If you’re asking, “how can I lower my car loan interest rate?” use the steps below:

  1. Check your credit score: Understanding where your credit score currently sits is a good way to be prepared for negotiations. 
  2. Clean up your score: You can quickly set up payment plans, dispute errors, and more to get your credit score in order. 
  3. Shop Around: Study the average interest rates for similar shoppers, and get to know the local market around Concord. You can also compare rates and terms from a variety of lenders to get a competitive offer. 
  4. Enlist a cosigner: If you have someone in your life that’s supporting you as you boost your credit score, they may be able to cosign your loan. This will help lower your interest rate, especially if you have bad credit. 
  5. Consider in-house financing: If you get your loan through the dealership, you may be able to set up more flexible terms. Banks have different standards for lending, so they are often more rigid and less understanding. 

Your Credit Score and Interest Rate

As mentioned above, the higher the credit score, the lower the interest rate. If you’re thinking about financing a car and you’re asking yourself, “can you lower interest rates on a car loan?” the key is your credit score. Check out the average auto loan interest rates based on credit scores below:

  • 800 – 740: 3.2% interest rate (on average)
  • 739 – 680: 4.5% interest rate (on average)
  • 680 and below: 6.5% – 12.9% (on average)

Finance A Used Vehicle With Music City Autoplex

Now that you know how to get a lower interest rate on a car loan, visit us at our Madison dealership near Hendersonville to get a great deal today. Contact us for more information! 

 

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