How can I determine what finance rate I can get on a car?
I know what my credit score is, how can I find out what the best finance rate I can get is without going to a dealership?
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Answer by Jay C
The short answer is, you won't know the best interest rate out there for you is unless you rate shop. Shop around for a pre-approval. When you have a pre-approval you also have the upper hand at the dealership and are more likely to receive a discount. As an example, let's say you get a pre-approval for a car loan up to 25k. You can walk into the dealership and find a car for 20k, and tell them you will only purchase that car if they can get it within your pre-approval of 18k, otherwise they will not get your business. Rather than lose an 18k sale, they will take the 2k discount. Back to your initial question, when you go to the dealership they submit your application to various lenders and present you with the lowest interest rate returned. Do the same for yourself(and start with a credit union if you are a member of one, they typically have the lowest interest rates because they are not-for-profit). Simply go to credit unions and financial institutions asking for a car loan pre-approval and go with the one lowest rate. Finally, when rate shopping, the actual loan you accept shows as the hard hit on your credit bureau, leaving the rest as soft hits(insignificant). This is a 10 day window. Good luck on your loan shopping!
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