Record Low Interest Rates on Car Loans
While this may not seem like a big drop, the typical car buyers is actually saving over $1,000 in financing costs compared to last year.
We can thank Toyota for starting the incentives war after they introduced 0% financing following their recall fiasco. Although Toyota has scaled back their incentives to certain regions, other car makers have picked up the slack.
GM, Ford, Nissan, Chrysler, Mazda, Suzuki and Saab all offer 0% financing on some of their models. Even Porsche is offering 1.9% financing on all models except the Panamera.
Banks and credit unions have also become more competitive with their car loans. Last year, it was very difficult to get financing even if you had great credit. Now, many car buyers can secure financing without having to pay outrageous interest rates.
One word of caution: Don't assume you automatically qualify for the low-rate financing offered by the car manufacturers. Many still require you to have great credit. Nothing is worse than going to a dealership thinking you're getting a low interest rate only to discover you don't qualify.
Always have a backup plan and make sure you secure financing before going to a dealership. Securing financing doesn't mean you have to use it. The dealer will usually try to offer a better rate than what you already have.
3 Steps Every Car Buyer Needs to Take to Save Maximum MoneyThe key to getting the best deal is to gather price or lease bids from as many local dealers as possible. Then shop that best price around until no one can beat it. Here are the steps:
Step 1 Get Prices From My Trusted NetworkSelect the vehicle you're interested in to see if there are local dealers in my network who will provide you with their best upfront price. You will get direct access to an internet sales manager who you can further negotiate with online (no need to visit dealership).
Step 2 Get Prices From TrueCar / CarsDirectTrueCar, and CarsDirect are my top 2 online price quote recommendations. These services show you pre-negotiated prices from dealers closest to you - and the deals are usually pretty decent. But remember, you can still negotiate further.
Step 3 Complete my ChecklistFollow this up with my checklist to make sure you squeeze out every last bit of savings.
- Gregg Fidan
Each week, I'll keep you up-to-date on the latest car deals and news that might affect your purchase. This includes...
- Best Rebates, Incentives, and Lease Deals
- Latest Car Buying Scams and Tricks
- The Best & Worst Time to Buy a Car
- Which Cars You Should Avoid