Tips On Auto Financing If You Have Poor Credit

Easy credit and longer-term loans currently being offered at auto dealerships can make buying an expensive car alluring. Greg McBride, chief financial analyst at the website, says consumers with poor credit shouldn’t bite.

Consumers tend to focus on the payment rather than the interest rate, which likely will be far higher than the below 3-percent rate now available to those with good credit.

“They engage in the dangerous financial habit known as payment shopping,” McBride says.

Here’s what he suggests instead.

— Buy a lower-priced car or a used car with a shorter payoff period. Paying it off will help you get a lower interest rate on your next car.

— Don’t be fooled by the payment on a loan that’s six years or longer. Look at the interest rate, which could be double or more what borrowers with good credit can get. It will take years for you to build any equity in your car.

— Don’t buy a car until you pay down other debts and improve your credit rating.

— Try to save for a bigger down payment. This could get you a lower interest rate.

(© Copyright 2014 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)


Leave a Reply

Fill in your details below or click an icon to log in:

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More From CBS Tampa

2016 Inspired DIY Halloween CostumesIt was nearly impossible to narrow it down, but somehow I managed to put together 7 DIY, 2016 inspired costumes to try this Halloween.
Best Barbecue In Tampa BayWhile one may not traditionally associate Florida with Southern barbecue, Tampa Bay has its fair share of great barbecue restaurants.

Listen Live