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What is The Average Interest Rate for a Car Loan for a First-Time Buyer?

Mar 13th 2019 at 1:55 PM

 

If you're buying your first car, there are lots of questions that come to mind. There are lots of things running through your mind at that period but the most important question on the mind of a first-time buyer is this "how can I get a first-time buyer car loan with the best possible rate I can get?"

You just have to know that first-time buyer car loans come with high-interest rates and this is due to the fact that you basically have no credit history/record. For first-time car buyers, there are three different car loans you can choose from depending on the type of car you're trying to buy and your personal financial position/situation.

· Car loan: Car loans are offered by dealers, lenders, and banks. With this type of loan, the car is used as security for the loan.

· Secured personal loan: With this loan plan you can use other your car as collateral. You can also use other assets as collateral for your loan at still the same competitive rate.

· Unsecured personal loan: For an unsecured personal loan you don't need to risk your car as collateral. You'll need good credit to get this type of loan.

The national average interest rate for a car loan for first-time buyers is set at 4.21% but may vary from state to state.

Knowing the interest rates for your car loan can help you plan better for your car loans and prepare you with adequate knowledge on how to plan for repayment.

A first-time buyer needs to have some kind of credit history, either through credit card repayments, or other traditional finance agreement just to help you establish your credit history. Establish a credit history with a company that makes credit reports to the top lenders in the country.

Once you've established a credit history for a minimum of a 6 month period getting a car loan becomes very easy. As a first time buyer, you should do some research because different lenders offer different prices at different times, so it is important to know what different lenders offer especially for first-time buyers.

Once you're done with your research you'll make a more informed decision.

Before shopping for a car as a new buyer you should try getting a pre-approval. You should do a pre-approval to know the type of car you can afford and then act accordingly. It will be a shame to fall in love with a car and then find out you can't purchase it. A pre-approval will save you from that stress.

The interest rate for first-time buyers vary, so do your research then act accordingly as your research suggests. This is particularly true when it comes do getting a car loan with bad credit in Rancho Cucamonga, CA! Do your research, take your time and browse around. It’s better to be more informed than it is to be misinformed

 

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