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Buying a Used Car? Use This Money Saving Checklist

When you’re in the market for a used car, decision-making can be overwhelming. Deciding on the car’s make, model, and the year is only the beginning. Your list of car specifications is long and might include color, minimum safety requirements, and mileage, along with special features like a sunroof. Shopping for the best car deal that fits your used car “must-haves” can be exhausting, especially if you’re on a budget. Decision fatigue is real. With every new test drive, you become more uncertain about which vehicle to purchase, turning what was once excitement into frustration. 

You might be tempted to pay any amount so you can get on the road – now! But, there’s no reason to rush a used car purchase. Refer to this used car money-saving checklist to secure the keys to the perfect ride for your personality and your wallet. 

Check Your Credit
Unless you intend to hand over cash for your vehicle, check your credit before you apply for an auto loan. Many lenders factor credit scores into their credit approval decisions. Your credit score is a numeric representation of your credit history report and will affect your financing options. A bruised credit score can cost you. Usually, lower credit scores mean higher auto loan interest rates.  Conversely, a high credit score can help you obtain the lowest interest rate loan with favorable repayment terms. 

Review your credit history report for inaccuracies. Copies of your reports are available at no cost when you request them from Once you have a copy of each report from the major credit reporting bureaus: Equifax, Experian, and TransUnion, review them for errors. If incorrect information appears on the reports, follow the dispute policies for each bureau to request corrections.

If you’ve had a financial misstep or two in the not so distant past, you can improve your credit score by establishing a pattern of consecutive, on-time payments and by keeping credit utilization low. This might require at least 18 months of on-time payments and a significant balance reduction on your open credit accounts. Perfect credit isn’t required for approval, but applying for an auto loan when you have a good credit history is likely to save you money in the long run.

Prepare for Negotiation
You can avoid paying the sticker price by performing your research before visiting the car dealership. Use a trusted source such as Kelly Blue Book or to determine the value of the car based on such things as condition, mileage, and unique features. Knowing the facts prepares you to negotiate on pricing, and you could save anywhere from a few $100 to several $1000 off the original asking price. Consider offering 15% less than the fair market range based on your research. Be prepared for healthy haggling to obtain the best deal. 

Compare Financing Options
After you’ve negotiated on price using the Kelly Blue Book as your guide, you’re ready to talk financing. An auto loan is about more than the monthly payment. If your goal is to save money, then you must examine how much financing will cost you. What appears to be a good deal initially can turn sour if the financing is less than favorable. 

Buyers can secure financing from the car dealership, bank, or a credit union but need to consider whether a lower monthly payment is worth it. Use an auto loan calculator to see how different repayment terms or down payment amounts impact the monthly payment and total purchase price. Lower payments are often made possible by longer repayment terms. 

Purchasing a car is the first of many financial decisions you’ll make in your lifetime. For many people, it’s the first step to establishing good credit which is needed to secure a low-interest rate credit card or buy a home in the future. Let us help you secure an auto loan with a competitive rate and flexible terms that match your budget. Apply now! 

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