Tips for Financing a Used Car
Whether you’re just starting your search or are ready to get behind the wheel, understanding the used car financing process can make your shopping experience easier. That’s why Honda of Bay County is here with a few tips to help you finance your used car.
Check them out below, and contact our dealership near Panama City, Springfield, and Callaway if you have any questions.
Determine Your Budget
When you’re shopping for a used car, taking the time to create a budget based on your specific preferences is always a good idea.
However, the cost of a pre-owned vehicle doesn’t just include the monthly payment and the down payment; it also includes things like insurance, fuel, and routine services. So, be sure you’re thinking about those recurring expenses, too. That way, you can get an idea of how much you’ll want to save when you’re ready to finance.
Add a Down Payment
Want to help reduce the amount on your used car finance bill? A down payment can help. With a down payment, you’ll be able to pay off a portion of the car before you’ve even brought it home. This can help make monthly payments more affordable, and it can even help you pay off your loan earlier.
Generally, drivers should put down about 10% of the used car’s value. However, the more you put down, the less your monthly payments may be. Also, a down payment is great for someone who may not have a high credit score because it lowers the amount you need to finance. You can even get started on the financing process by filling out our free finance application.
Understand Your Credit Score
Knowing your credit score is a must when you’re financing a used car. When applying for a loan, checking your score can help you see what types of offers you may be approved for. If your score is high, you may be approved for an option with lower interest rates.
If your credit is low or if you don’t have a score or history, you can opt for bad credit financing. With this, the dealership will work with you and your budget, regardless of what type of credit you have, so you can drive home with the right terms and used car for you.
Improve Your Credit
While there are great programs that’ll assist those with less-than-perfect credit get behind the wheel of their ideal used car, you should still take the steps needed to improve it. In doing so, you’ll be able to establish good financial habits and help you get the specific finance terms you need when you’re ready to get your next used car.
Here are a few ways you can improve your credit:
- Keep balance on credit card accounts at or below 30% of the limit
- Pay entire statement balance on time each month
- Keep new accounts to a minimum
Learn More About Financing a Used Car
Shopping for a used car is great but having the right tips can make the finance process easier and more convenient.
So, if you’re looking to finance a used car near Panama City, Springfield, and Callaway, follow these tips and get in touch with the Honda of Bay County finance team to learn more about your options!