Loan Articles

My credit is perfect, so when it was time to get a new car I was able to qualify for any of the available auto loans on the market. I do a lot of research before I make a big ticket purchase and when I started to shop, I already knew all of the types of financing available to me.

When I started to shop around I was shocked to find out that in some cases new cars are a better deal than used cars, mostly due to all of the rebates and incentives that car manufacturers are offering. Just about every shipping port in the world is full of new cars right now. With car sales down most manufacturers are giving away rebates to anyone wanting to buy a new car.

I could not have picked a better time to start shopping for a new car. Not only are car dealerships desperate to improve sales, but interest rates are so low that auto loans for people with bad credit even have low interest rates.

A little known secret people should be aware of when researching different types of financing, is that most states have an interest rate cap on all consumer loan options, even auto loans. Each state has different rules regarding the amount of interest consumers can be charged.

With all of the news about the so called housing crisis, congress is now working on passing a bill that will set a federal cap on the amount of interest loan companies can charge. This bill will only affect some states, because several states already have interest rate caps lower than the proposed bill. This bill will affect title loan companies more than it will affect standard auto loans.

In regards to auto loans, some states already have a fair cap to interest rate on auto loans. For example, in Delaware the caps on interest rates are limited to 5% over the Federal Reserve’s prime rate. Some companies that offer loans to consumers can bypass these caps by originating the loans in another state, meaning you should make sure your understand your state’s laws before getting a loan.

People out shopping for cars should really take some time to find the right auto loans and terms for them. With just a little research, people with any type of credit rating can get loans that will help keep their financial outlook bright.