An auto loan allows you to purchase a car over time without having to completely pay for the purchase initially. There’s several advantages to obtaining a car loan. An auto loan will allow you to purchase a more expensive vehicle than you could afford without such a loan. An auto loan can also help to build your credit rating. Additionally, unlike leasing, at the end of the auto loan you will own the vehicle outright. Let’s take a look at some more of the benefits of getting a car loan.

Owning vs. Leasing

When you purchase a vehicle using an auto loan, you will typically make a down payment and monthly payments for the term of the loan. At the conclusion of the loan, you will own the vehicle outright. Leasing, on the other hand, is a form of renting a vehicle. With a lease, you will still make monthly payments. However, at the conclusion of the lease, you can either choose to buy the vehicle for a predetermined lump sum or return the vehicle to the dealer. As a form of renting, leased vehicles also commonly limit the amount of miles you can drive during the duration of the lease.

Credit Rating

Purchasing a vehicle using an auto loan can help to build your credit. Always make your car payments on time and do not agree to a car loan you cannot afford. An auto loan is a type of installment loan. This means that you pay a specified amount every month and the loan terminates at the end of the specified term. Unlike a revolving loan, an installment loan does not feature a credit limit. A credit card is the most common example of a revolving line of credit. Credit bureaus generally consider an auto loan a favorable line of credit and paying the loan back over time will, therefore, typically improve your credit score.

Affordability

When you initiate an auto loan, you will usually have to make a down payment. The specific amount of this down payment will depend on the loan. Various lenders offer several auto loan options that require varying down payment amounts. Because an auto loan allows you to finance the vehicle over time, these loans allow you to purchase a more expensive vehicle than you could purchase if paying by cash. The auto loan’s monthly payment depends on the down payment made, the purchase price of the vehicle and the term of the loan.

Many lenders now offer auto loans with terms longer than six years. These longer-term loans generally reduce the monthly payment required for the duration of the loan. However, you should exercise caution when agreeing to long-term car loans, as the loan will normally exceed the vehicle’s warranty period. Also, look for auto loans that do not require you to pay a prepayment penalty should you choose to pay off the loan prior to the contracted term. Do your research at moneysupermarket.com, which offers many attractive auto loan options for your vehicle purchase.

Unbelievably, sometimes it may be easier to get a loan for a car when you have bad credit rather than not having credit at all. This is why it is imperative that you use your credit wisely as early as you can. For young people, they can be added to their parents credit card or they can get their own cell phone. Just something that establishes that they are responsible at making monthly payments on time.

However for many young people getting a car is the first time they’ve really needed to use their credit. But there’s no need to worry, there are still ways to get a car loan without having first established a long credit history. Here is how it can be done.

Trade-In

If you have an older car you can sell/give to the dealer they can use that to reduce the amount you owe on your new car. When you’re trying to get a car with no credit, you need the smallest loan possible and trading in your current car helps you lower the amount of your loan.

Down Payment

By making a nicely sized down payment (more than 25% of the car’s value) you are reducing the total of your loan. But making a down payment doesn’t just lower the amount you owe, it also shows the bank that you have a lot to lose if you default on this loan. It shows you have invested a substantial amount of money and would do anything within your power to make sure you get this loan paid off. This is called the loan to value ratio.

Co-Signer

Using a co-signer with good credit is a surefire way of getting your auto loan application approved. All the co-signer needs to do is show up and sign on the dotted line. By doing so, they are agreeing to be held financially responsible should you ever default on the car loan. You are essentially using their credit to get yourself a car. Consider yourself lucky if someone is willing to be a cosigner for you. Be careful though because if you miss payments you will be ruining both their credit and your relationship.

In closing, if you can do all or most of these things you can walk away from the dealership with your very own car, even if you have never used your credit before.

Planning to get financing help by applying for a loan? For most people, it sounds to be a very stressful experience to apply for a mortgage loan. We will have to take many things into consideration while applying for any type of mortgage loans. Plus, there will be a lot of money to be spent in the process. However, we can still find some quick and money-saving tips when getting a loan – using loan calculator.

Loan calculator is a very powerful and useful device used by the lenders, borrowers and realtors. People use loan calculator to determine the accurate amount of the mortgage loan payments and interest rates by inserting the different variables electronically and professionally. By using a loan calculator, we can decide the accurate monthly payments, interest rates, insurance policy, taxes and other essentials for the mortgage.

By using loan calculators, the applicants can clearly know about the specific details and all the payments for their loans. Loan calculator helps the borrowers to budget and prepare for the future in a better way. It makes it easy for us to spend the earnings and save money more efficiently. Loan calculators benefit in the following ways:

• Loan calculator proves to be very professional and efficient in use. It can work out the monthly payments in a few seconds and compare the products of different lenders within only several minutes. All the data and information it offers is absolutely accurate and precise, which allows us to save a lot of energy, time and money.

• For some loan calculators, after we insert the monthly payments we want to defray, they will deduct and find out the exact type of loan from some famous and credible lenders. To get a favorable result, we need to insert the appropriate number of monthly payments in the process. Basically, the monthly payments should cover no more than 30% of our monthly income.

• All the loan calculators allow us to calculate the loan payments in details and help us save a lot of money for the mortgage. As we know, the loan brokers are always unhappy to offer professional ideas to save our costs. Sometimes they even help us make a decision without taking our monthly salaries into consideration. Therefore, it is possible for us to calculate all the related statistics by ourselves with the help of online loan calculators. In this way we can know clearly about the interest rates, monthly payments and other things for the loan.

• Another significant advantage of loan calculators is that it is easy to access. All the loan calculators are free online and open to all the individuals who need help. There are a great number of free online loan calculators available for everybody on the internet. But we have to be very careful while choosing the best online loan calculators. It is an acknowledged fact that quality loan calculators are always free online. So, if some web sites ask us to pay any extra fees for calculating, they may be unreliable corporations.

Find extensive and valuable information on loans, loan calculators and personal finance at Loans-Advisor.com.

When purchasing a car on credit you need to make timely payments each month or else you risk losing your car in a vehicle repossession. That’s why it’s important to only take on a loan you are sure you can afford. It’s also a good idea to have savings just in case you run into temporary financial issues. You should do everything within your power to make sure you don’t default on your auto loan. Nobody likes getting their car taken away. But the loss of your vehicle isn’t the last of your problems. Here are several consequences of a repossession.

Loss Of Vehicle

When you fall behind on your payments your vehicle may be repossessed. This is the single most damaging consequence of missing payments. Your car is not just a shiny toy. It is a tool you use to drive to work, to visit family, to go to the doctor and to drop off your kids at school. If your car is taken from you and you manage to get current on your account you may get your car back, but expect to pay hefty additional fees.

Loss Of Funds

If you’ve been paying let’s say $400 a month and are 25 months into a 60 month loan and then you stop paying, your car will be taken from you. This means you’ve paid $10,000 thus far (principal and interest combined). What do you think happens to all of that money? You guessed it, they keep it, you lose it. So not only do they get your car, but they get all the funds you’ve been paying for all these months (or years).

Credit Score

Expect a car repossession to wreak havoc on your credit score. The moment you miss your first payment, expect a significant drop. Then once you’ve defaulted and the car is taken, you can expect a devastating result. When you have a vehicle repossession on your credit report it is extremely difficult to get another car loan in the future. It will take years of timely payments to repair your credit score.

Debt

Let’s say you were laid off and did not have the money to pay for your car. You barely had enough to cover rent. So you miss your car payments and your credit score is hurt. Then your vehicle is repossessed. Now you’ve hit rock bottom. Not so fast. It can get even worse. Let’s say you owe bought a $20,000 shiny new truck. You made payments on it and you now owe $15,000. Then you default on the loan and they take your truck away. Afterward, it is sold at auction to the high bidder for just $10,000. The bank has lost $5,000 on the transaction. You still owe that money. The amount you owe will be reported on your credit report and if need be, they will sue you in court for the balance.

The current economy has created a buyer’s market for most purchases, including home and auto sales. Dealer incentives have made purchasing a new or a used car quite affordable. If you’re in the market for a used car, you can find even better bargains by buying from a private seller. Many car owners might be looking to sell their cars to downsize their monthly budgets or to raise cash. However, some deals might seem too good to be true because they are. Since warranties and other safeguards are not available when you buy from a private seller, there are several steps you have to take to ensure that the car you are purchasing is worth the sale price. Here are some tips:

Research the Value

There are several ways to determine if the asking price of the car is a fair reflection of its value. Tools such as the Kelly Blue Book or Edmunds.com can give you the average market value of a car based on its year, make, model, and condition. Check the value of the car you are interested in through several of these tools to get a good starting point for negotiations.

Do a Visual Inspection

There are several signs to look for that can tell you if there has been a problem with the car. Check the tread of the tires for signs of wear; look for rust and other signs of deterioration in the body; and look under the car for signs of leaking fluid. Other signs to watch for include new paint to indicate repairs after an accident, water lines on the body or interior to indicate flooding, matching VIN numbers on the dash and the door jambs to ensure the car is not stolen, and any other signs of damage such as dents, dings, and scratches.

Take a Test Drive

Driving a car can answer more questions about its condition and the personal fit than anything else that the owner says about it. Driving it can quickly tell you if there are any obvious mechanical problems. A test drive can also tell you if the car is a good fit for your personal style — whether you like the way it drives, if it handles well, and if it’s comfortable for you.

Get an Independent Inspection

Before you commit to buy, be sure to have the car checked by an independent mechanic. You can either bring the mechanic with you, or ask the seller to allow you to have the car checked before you commit to the sale. If any problems are found with the car, get a written report with estimates for repairs. This can help you to negotiate a lower price on the car, if you are still interested in buying it.

Check State Records

The car’s vehicle identification number (VIN) can be checked against state records for information about the car’s history. For example, you may be able to determine the sale history, estimates of mileage, accident reports, and problems with state inspections or emissions. You can also check the Carfax.com report for the car with the VIN for information about whether the car has been in an accident.

Before you commit to buy a car from a private seller, you should be very thorough in your inspection of the car and in the questions you ask the buyer. Find out why the car is being sold, and be sure to ask about a history of accidents, repairs, or other problems. Independent inspections and a test drive can help you to discover any other information not disclosed by the seller. Following these simple steps can help you to find a good bargain on a used car while also ensuring that the quality is worth the price.

Amanda Tradwick is a grant researcher and writer for CollegeGrants.org. She has a Bachelor’s degrees from the University of Delaware, and has recently finished research on grants for women and federal college grants.

One of the ways consumers can save money while still enjoying the convenience and benefits of credit cards is by transferring high-interest rate balances to low or zero-percent cards offered through the mail or online. With promotional balance transfer credit card periods now lasting as long as 21 months, simple mathematics will show that the balance transfer fee that accompanies most of these offers is a spit in the bucket in comparison to the amount of money that can be saved over that period of no interest borrowing.

For many consumers, making a balance transfer has no effect on their credit score, but for those who are struggling to increase or maintain an average credit rating the move may have negative consequences, according to some analysts. There are two potential areas that may be a problem for people with less than stellar credit:

Percentage of Debt

The percentage of your available credit that you are using is one thing to consider. Problems arise when you transfer a balance to an existing account instead of to a new one, resulting in a high debt percentage. For instance, if you have a $6,000 balance on a card with a $10,000 limit then you have a debt percentage of 60%. If you transfer that balance to a card with a limit of only $8,000, then your debt percentage has suddenly jumped up to 75%. This jump in debt percentage will negatively impact your credit score. As a general rule, transfer balances to a credit card with a limit equal to or higher than the one of the card you are transferring.

Credit Inquiries

If you apply for a new card, hoping to transfer a balance, the card company will automatically request to see your credit report, also known as an inquiry. Too many inquires may be a sign of a consumer in trouble. So wisely choose the offers you want to apply for and allow a length of time to pass before making another transfer.

Credit card balance transfers will either be a positive or negative effect on your score, depending on how you manage the situation. Transfer to a lower or no-interest credit card, pay it off before the promotional rate expires and enjoy a debt-free life and a boost in your score. With your debt eliminated, you’ll open up the opportunities for higher credit limits or bigger loans.

Noreen Ruth writes for ASAP’s credit card blog and several popular finance websites. She is interested in educating consumers about using credit responsibly and about legislative action that will affect their ability to borrow the money they need. She has contributed hundreds of articles to various online sites that provide content to educate consumers about the best credit card offers, debt settlement help, loans and other finance related topics.

There is a lot to be said for saving a buck, and when it comes to the purchase of a vehicle, the more you can save the better you will feel. There are some great ways to get a good deal on used vehicles. One of the best tips is to visit police and government auctions. In fact, standard savings on the purchase of a vehicle through these auctions is often 30-70 percent.

Always remember, that if you are on a tight budget, then the best way to purchase a vehicle is by paying cash, and this is the primary form of payment utilized at most of the auctions. If you are short on cash, though, there are many ways of getting your hands on cash quickly. For example, more and more consumers are considering the benefits of short-term loans such as auto title loans, which can provide you with the funds you need to bid on a car in a matter of hours.

Before you attend an auction, though, you should purchase a car buyer’s guide at caranddriver.com, which will show you the retail value of various makes and models to ensure that you get a good deal.

To find police department auctions near you, call your local police department and ask them for the dates and times of the auctions. Also, ask them for all other information regarding the auctions, such as a website where they may be displaying the vehicles or a catalogue of what will be for sale.

When you find a vehicle that you are interested in, run a VIN check at carfax.com on the vehicle which will tell you pertinent information such as whether the vehicle has ever been salvaged, the number of accidents it has been in, the number of owners, its odometer reading, its service reports and so on. This is one of the most valuable pieces of documentation regarding used vehicles for prospective buyers and one that just might save you from purchasing a vehicle that is a lemon.

Sarah Waters lives in Los Angeles and blogs about financial news, consumer tips, and car buyer advice. Her major areas of expertise are car title loans and auto title loans.

Proper record keeping is very important for anything that involves finances. This is certainly no different when the investment is an automobile. Keeping good records can make the difference when trying to get a good deal when trading a car in or selling it yourself. It is also extremely important for many legal reasons as well. To help, below are eight tips you can use when organizing your official car documents.

1. Keep Separate Files For Each Vehicle

The most important element to proper record keeping is organization. It is what allows you find the documents you need easily. If you simply lump all the records for all your different cars together, sorting them out later can be quite a hassle. Instead, make sure you keep a folder for each different vehicle’s records separate from each other.

2. Don’t Rely On Digital Record Keeping

Another important thing you should do is make sure your files survive for the long term. While computers and digital devices have made our lives easier, they do not last. The average lifespan of a computer is now three to four years tops. Often, a computer is retired after the software or hardware stops functioning completely. If this occurs, all files may be lost. This is why it is important to always keep hard copies for all of your car documents.

3. Keep All Service Records

Storing service records for your vehicle is extremely important. Every time your car is worked on, you should be provided with documentation. Proper record keeping should be done every time your car is repaired. It should also be done each time your car has an oil change. If you need to prove proper maintenance of your vehicle later on, this will give you the ability to do so.

4. Include Records for All Car Related Purchases

While you obviously need to store all information related to your initial purchase of a vehicle, you should also store documentation for other purchases related to the vehicle made later on. If you have to replace your windshield wipers, the documentation for this purchase should be stored. This is also the case for each time you purchase new tires or batteries. This gives a clearer picture to just how much of an investment was actually made in a vehicle.

5. Record Your Mileage

This isn’t the most essential information you will have to record keep. That is because this information can obviously be taken from the car itself. However, sometimes something can go wrong that causes the odometer to give an inaccurate reading. It may also be important to record the amount of miles traveled in one year for tax purposes.

6. Store The Files Properly

You should place all files inside a file cabinet. If you don’t have one, purchase one. You should be keeping files for other things such as taxes, medical records, mortgage payments, etc. So having a car isn’t the only reason to own a file cabinet. Place your car’s files inside a folder inside this file cabinet. If you eventually accrue a very large amount of files, switch to a three ring binder to make sure no paperwork accidentally falls out.

7. Use A Computer Program For Further Assistance

While you should make sure to store hard copies of all your documents properly, there can be real benefits to keeping this information stored digitally as well. It can allow easy retrieval of documents when you don’t want to go through you file cabinet to find the information. Just make sure to install a program that can enhance this convenience for you. Such programs can allow you to easily search for the information on your hard-drive or online through cloud computing.

8. Use Other Digital Features to Enhance Your Record Keeping

There is also a wide array of other features to software or online tools that can improve your ability to accurately track your vehicle’s history. For example, certain programs can track your car’s mileage and then remind you to have certain kinds of maintenance performed on your vehicle exactly when you need it. Such a program can also do things that ordinary record keeping can’t. For example, it can automatically notify you of any recalls being performed on vehicles you own.

James is involved in the upkeep of a printer cartridge website, where he spend a lot of time blogging, writing and cataloguing HP printer cartridges.

When you opt for a three or five year auto loan there inevitably will come a time when you’re in danger of making a late payment or you miss a payment. These loans are 36 or 60 months long and it can be difficult to maintain a perfect payment history. The question is though, what happens if you miss one monthly car payment?

Credit Score

Missing just one payment can have devastating effects. If you have been working hard to improve your credit score, one missed payment will make it drop dramatically. The good news is that the score will recover in a few months. But expect a significant ding to your score in the short term.

Late Fees

By missing a car payment you are also going to be hit with late fees. So now not only are you paying for your car and paying for interest, but you’re also giving them late fees. This late fee does not go toward reducing the balance of your debt so you can consider this money to be completely wasted.

Don’t Worry

If you did miss one auto loan payment due to forgetting or another accidental mishap, you need not worry. Your vehicle will not be repossessed simply by missing just one payment. Your future payments will not go up due to this missing payment. You should pay the missed payment as soon as you can and make sure that you are not late again.

If this is your first time being late, you can be proactive and contact your lender and let them know of the situation. If you are able to make the payment at that time, do so. Furthermore, you can ask them if they can waive the late fee as well. Most of the time this request is granted if you have a steady history of timely payments.

A good driving record goes a long way toward saving money on car insurance, but it is not the only way to earn a discount. Even with a driving history riddled with accidents, traffic violations or both, you may be able to take advantage of these discounts.

Vehicle Safety Equipment

Upgrade your vehicle’s safety gear by having airbags, automatic seat-belts, or anti-lock brakes installed. Since most of these options are standard features on many current models, you might already qualify for this discount.

Multiple Vehicle Policies

Many households have more than one vehicle. If your spouse or children drive their own cars, you can save money by purchasing their car insurance through your car insurance company. Most insurance companies offer multiple policy discounts to drivers related through blood or marriage.

Good Credit Rating

Your credit rating can play a big role in your car insurance cost. If you have a good rating, you might qualify for the special discount many insurance companies offer. Even if your company doesn’t offer a specific discount, your credit rating will be a factor in the overall determination of your premium.

Homeowner Discounts

Owning your own home can earn you a standard discount through most car insurance providers. You might be able to score an additional discount if you bundle your home and auto insurance with one company.

Approved Driving Courses

In some states, insurance providers offer discounts to drivers who agree to attend approved driving classes. The discount is available to drivers of all ages in most cases, but some insurance companies might offer this discount only to older drivers or those younger than 25.

Academic Discounts

Students 25 years or younger and enrolled full time in high school or college can earn special discounts if they maintain a grade point average of 3.0 or higher. The discount applies whether the student is covered through a parent’s insurance policy or through his or her own policy.

Anti-Theft Devices

Take additional measures to protect your vehicle from theft. Install anything from a steering wheel lock to an electronic alarm system and earn a discount. In most cases, owning especially effective anti-theft devices, such as OnStar systems and vehicle recovery systems, will result in the highest discounts, although discount details vary depending on the insurance company.

Annual Payments

Choosing to pay your insurance premium once a year can earn you a discount at many insurance companies. Annual payments cut down on the amount of paperwork on your account, and, with only one payment to make, you’ll decrease your chance of making a late payment.

Reduced Mileage

Finding alternatives to driving can earn you a good discount and help you improve your driving record. Most insurance companies offer discounts to drivers who record fewer miles because the risk of being involved in an accident is minimized. Carpooling and using public transportation will help keep your insurance costs down.

This has been a guest post by Jessica Bosari who writes for CarInsuranceQuotesComparison.com where you can compare the rates of companies like Progressive, GEICO, and MetLife Auto Insurance.