You should check with your personal bank and banks in your area to see what kind of rates and vehicles you’ll be able to get. This will come in handy later on.

Before you do anything though, you should probably take a look at your credit report. There are three scores that most banks and other financial lenders will look at. They come from three different companies: Equifax, Experian, and the TransUnion. These companies report information to your prospective lenders, telling them whether or not you have repaid large sums of money or whether you have defaulted on loans in the past. These critiques will determine how much money you can apply for–if you can apply for any at all. So make sure to keep your credit clean at all times to avoid possible rejection.

As stated earlier, it’s important to plan ahead for most any important and long-time financing. You don’t want to fall into any sort of debt, and having to read a debt collection letter can be pretty scary. Try to avoid it if you can. You can talk with your financing bank about the interest rate that you will have and figure out how many months you’d like to extend your loan over. Most car loans are 36 months, but you can extend them up to 60 months if you’d like. You need to know that extending your contract will lead to you paying thousands of dollars over the price in the extra interest that’s added. The payments may look nice because they are small, but it could really hurt you in the long run.

Knowing ahead of time what your ability to finance is will help you make deals with the car dealership and will allow you to stick with what you can afford. You won’t get your heart set on a car that you can’t get financed for. Dealerships will sometimes offer you better rates than your other lenders when if you choose to use their financing options. Sometimes this is good and sometimes it’s bad. You need to look at what you can afford and see if their options are better for the price range. Due a little bit of number crunching and process the newly found information. Be sure to figure out if the payments will help the overall price of the car or not.

Double check your calculations to make sure you make the right decisions. Figure out if, for example, it’s better to pay 0% interest financing at the dealership compared to a 8% or 9% interest rate at your bank. One may seem more favorable initially, but you have to factor in potential rebates and the length of the loan itself. Weigh out the pros and cons of each options and carefully choose the one that suits your needs and your budget.

Having a down payment will really help you manage to keep your payments as low as possible and can also make the overall payments lower since you won’t be paying as much interest. Be careful with your decisions. You don’t want to overstretch yourself as this loan will help you establish a large amount of credit. Don’t want pile on too much or think that you can afford more than you actually can. You could have your car repossessed due to lack of payment as this will drastically damage your credit. Overall, as long as you stay informed and plan carefully, you should be able to get the car of your dreams without having a debt collection letter sent to you about it.

To your independence,