Understanding Financing | Fort Wayne, IN
Financing your purchase at Tom Kelley allows you to get behind the wheel of the car you want. Few people can pay cash up front, and that’s not a problem — as long as you have a reliable lender. There are a few things to keep in mind before you choose where to finance your car.
What Do Lenders Look For?
Most lenders look at your credit rating above all else, and your ratio of debt to income is also important. A credit rating above 680 is considered a good score. Lenders will also consider the amount you’re asking for and the proportion you’re willing to pay on a down payment. About 10 to 20 percent of the sticker price is common for down payments.
Dealerships vs. Other Lenders
You should choose dealership financing if you’re looking for the most convenient buying option. You may also find better deals through dealerships, as many finance departments will be able to search for both local and national lenders to find you a better option. While some shoppers prefer to visit banks to find the best financing option, you may be better off going through a dealership.
Banks and credit unions may be smart options if you have a strong relationship with those institutions already, and online auto financing has also become more popular. However, keep in mind that if you want the simplest or fastest financing, the dealership will be your best bet.
Zero-Down and Special Deals
Often, dealerships and manufacturers will offer special rates around the holidays, and you may be able to find special deals if you are a veteran or recent college graduate, for instance. Many places even offer financing with zero-down — which means you won’t have to make a down payment — but it’s important to note that such deals sometimes only apply to those with strong credit.
It’s always important to talk through your options with a dealership, bank, or other personal finance professional. If you have any questions about financing a car, visit us at Tom Kelley and we’d be glad to answer them.