Hagerstown (MD) Auto Loans

Purchasing a new car or truck without a loan or lease is quite unusual these days. If you have extremely good credit, this is a pretty painless process. When you have credit problems, however, it can be an absolute headache. Many finance experts advise obtaining your financing before stepping foot on the dealer lot, which provides several benefits:

• Fewer hours wasted at the dealership.
• Reduced interest rates.
• Improved negotiating leverage.

This is especially useful for people who have unfavorable credit ratings, as a variety of dealers and lending companies will review your application, many of which specialize in subprime lending.

Auto Finance Rates in Hagerstown

Most loan companies don’t display loan rates in Hagerstown based on credit score. Instead, they tell you the cheapest rate available. In point of fact, your interest rate can vary widely based on your credit score, among a range of other variables. The rates displayed below are only for informational purposes. They are not advertisements, and your precise rate could be very different.

Credit Score	New Car	Pre-owned Car
Excellent	3.2%	3.8%
Good	4.5%	5.1%
Average	6.9%	8.1%
Subprime	10.0%	11.9%
Bad	13.8%	17.7%
Very Bad	15.7%	19.1%

Do you know your credit score? You should. We suggest going here, where you can check your score absolutely free.

Used Car Loans in Hagerstown

We are continually slammed with advertising for new cars and trucks. Having said that, to put yourself in the strongest position financially, you might want to finance a pre-owned car. Below, we compare the costs of a loan for a car that’s new versus one, two, or three years old.

Age	Price	Rate	Months	Payment	Interest	Total Cost
New	$16,000	6.00%	60	$309.32	$2,559	$18,559
1 Year	$12,800	7.50%	60	$256.49	$2,589	$15,389
2 Years	$10,880	7.50%	60	$218.01	$2,201	$13,081
3 Years	$9,248	7.50%	60	$185.31	$1,871	$11,119

After only one full year of driving, the $16,000 new car is worth only $12,800, and only $9,248 after three years. Loan companies charge higher rates of interest for pre-owned cars, but in many cases, you only need 10% down, and the insurance costs are less costly.

Poor Credit Car Loans in Hagerstown

Right off the bat, lenders examine when deciding whether to approve you financing. Generally speaking, when you have a low credit score, you can expect a rate north of 10%. In the old days, shoppers had to go from one lender to the next, searching for one able to offer them financing. Fortunately, technological advances have done away with a lot of this groundwork.

Many people wind up resorting to buy here pay here car lots in Hagerstown, most of which don’t perform credit checks. The negatives are significant: inflated annual percentage rates and lots of stipulations. As a general rule, it’s preferable to deal with a traditional bank, credit union, or loan provider. There are many benefits: better rates of interest, far better service, and if you make your payments on time, an increase to your FICO score.

Contact an auto finance professional in your area today.

Hagerstown Credit Improvement

Apart from choosing a more economical car or truck, the best way to decrease your monthly payment is by improving your credit. A large percentage of potential buyers have inaccuracies on their credit reports. These kinds of errors could be harming your credit score, and you don’t even know it. Lots of folks don’t know that, once a year, you can check your credit report completely free via annualcreditreport.com. You can challenge any errors on your own, or get a company to help you. If you don’t have the best credit, having a spouse or relative with a good credit score cosign your loan could lead to a less expensive interest rate.

Can a Car Loan Improve Your Credit?

If you care to increase your credit score, an auto loan can help–as long as you pay each installment as arranged. Buy here pay here dealers rarely report to the credit reporting agencies, which means your credit score will not get better. Most lenders offer automated bill payment options, which are key to keeping current on your payments.

Hagerstown Resources

• Maryland Motor Vehicle Administration: http://www.mva.maryland.gov/
• MD Office of Financial Regulation: http://www.dllr.state.md.us/finance/

Credit Unions