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October 17, 2019 at 5:09 PMComments: 0 Faves: 0

Smart Car Finance

By smartathome More Blogs by This Author

During the process of buying a vehicle, you might find yourself with some questions. Here are a few of the most commonly asked questions that you might think of while you are financing your car especially if your credit is less than perfect so you would be looking for a bad credit car loan to get that motor that you deserve .

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Should I Get a Fixed or Variable Interest Rate?

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One of the tough questions that you may be faced with when getting a car loan is whether you should get a variable or fixed rate loan. Sometimes, the variable rate loan may seem more attractive initially because it gives you a smaller monthly payment. However, it can be dangerous to take on a variable loan, because you can't be sure of what your payment is going to be in the future. When the market interest rates go up, it can increase the monthly payment of your loan. In some cases, the payment can be boosted pretty substantially. With a fixed rate loan, you know exactly what your payment is going to be every month of the loan. If you are confident that interest rates are going to remain low during the entire term of your loan, then a variable rate loan makes sense. Otherwise, go with a fixed rate loan.

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Should I Lease or Buy?

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Many car dealerships give you the option of leasing or buying a new car. Trying to decide between leasing and buying can be difficult because there are many different factors involved. For example, you have to consider how much you be driving because leases have limits on how many miles you can drive per year. If you go over the limit, you'll have to pay overage charges. The lease payment will be lower than the loan payment, so it can save you money on a monthly basis. However, you won't own the vehicle when you're done. You also have to consider the possibility of having to pay for damages when you turn your lease back in.

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Should I Get Credit Insurance?

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Some lenders offer credit insurance to the buyer of a vehicle. With this type of insurance, the payments will be taken care of for you if you become disabled or otherwise cannot pay your auto loan payments. This type of coverage can come in handy, but it's not a requirement of you. If you are scared of the possibility of not being able to make your payments at some point in the future, it may be a good idea to add this in.

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