- Get pre-approved first. If you’re going to be financing your loan get pre approved on your loan first. This way you can compare the rate that your dealer will offer you.

- Bring a friend. Don’t go car shopping alone. Having a second opinion goes a long way. Everyone at the dealership will be trying to convince you to say yes.

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If you’re at the dealer and you get the bad news that you have bad credit, they will often times still offer you a car loan but for a very high interest rate. One of the lines they’ll use is this..

You have bad credit, but we believe in you, we trust you. I’m willing to offer you a car loan anyway. Don’t worry about the high interest rate. I’ll extend the loan to make your payments more manageable. You really should do it, this will be a great way to re-establish your credit.

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When you buy a car on credit, you don’t even own the car until you’re done paying for it. The bank owns your car. This means that you are borrowing it. Your vehicle can be taken away from you if you violate the contract you signed at the time you signed your car loan. Here are some things you should know about regarding vehicle repossession.

- Your lender can repossess your car if you miss a payment. If you know you’re going to be late or miss a payment or two. Get in touch with them. Be upfront and honest with them and they may be able to work something out. If they agree to make some arrangements to your loan or your payments temporarily, get it in writing. This way, they can’t repossess your car for missing or being short on a payment.

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When buying a new car you would think that the most important thing is what your monthly payment will be. You calculate what you earn and then subtract your rent/mortgage payment, utility fees, miscellaneous fees and then you come up with a dollar figure you can afford per month.

But there’s a problem with that. What you pay per month is not the most important thing. The interest rate is. You see, lenders will just stretch your loan out to five or six years in order to lower your payment.

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Here are some tips to increase the chances that you’ll be approved on an auto loan..

- It helps if you’ve previously paid off a car before. There’s nothing better that a lender wants to see than a paid off car in your credit report.

- Good income to debt ratio. In other words, make a lot of money and owe very little money.

- Be employed. Lenders like a stable history. So don’t apply for a car loan unless you’ve been at the same job for a while.

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Based on your credit history you may find either a prime or sub prime auto lender is your best choice.

The Differences Between Prime and Sub Prime Lenders

Prime and sub prime lenders differ in the types of auto loans they offer. Prime lenders offer auto loans to those with credit scores of 650 or higher. Sub prime lenders provide auto loans to everyone else.

Who Has The Best Auto Loan Rates?

The only way to find who has the best rates is to do your own comparison shopping. Depending on your credit score, you may be surprised who can offer you the most competitive package.

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