Determine Credit Scores

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Shopping for a new vehicle requires plenty of thought and preparation prior to arriving at the dealership. Consumers often grapple with trying to find the right vehicles to buy and obtaining the right purchase prices. Once they find the right vehicles at the right prices, then they must obtain the proper financing if they cannot pay in cash. The car buying experience can get tricky if consumers do not know if they qualify for credit approval. However, car buyers can follow some simple tips to improve their chances of credit approval on their vehicle purchases.

Determine Credit Scores in Advance
Many consumers fail to obtain their credit scores before applying for any type of financing. Credit scores are a big part of determining whether or not a consumer qualifies for financing. Credit scores also play a role in the interest rates consumers will pay as part of their financing. The best way to determine accurate credit scores is to order credit reports from one of the three major reporting agencies: TransUnion, Experian and Equifax. In short, the higher the credit score, the better chance of loan approval for a car purchase.

Clean Up Credit Reports
Upon receiving their credit reports,
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First of all, the lower the interest payments on car loans, the lower the monthly payments, there is not mystery to that philosophy. However, consumers who shop around for low rates may stand a better chance of credit approval if they do qualify for the lower rates. Banks and lenders use what are known as compensating factors in their credit decisions. The factors include healthy assets, strong work histories, low debt-to-income ratios and solid incomes. Although a person’s credit scores may be low, good compensating factors help offset those scores allowing them to qualify for lower rates. Shopping for lower rates essentially increases a consumers chances for credit
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