Best Car Loan Rates - Prime Lenders vs. Sub Prime Auto Lenders
Written by: Carrie Reeder
The best car loan rates are out there if you search for them.
Based on your credit past, you may find either a prime or sub
prime auto lender is your best choice. The surest way to find
the answer is to request free online loan quotes to narrow your
The Differences Between Prime and Sub Prime Lenders
Prime and sub prime lenders differ in the types of loans they
offer. Prime lenders offer A loans to those with credit scores
of 650 or higher. Sub prime lenders provide loans to everyone
else. Sometimes though, financing companies offer both types of
Sub prime loans have higher rates and fees since the risk is
higher for lenders. Reasonable lenders will only charge a couple
of points higher for most types of loans.
Who Has The Best Rates?
The only way to find who has the best rates is to do your own
comparison shopping. Depending on your credit score, you may be
surprised who can offer you the most competitive package.
As important as low rates are, fees should also be considered.
Fortunately the government made comparison shopping easy by
requiring lenders to disclose the APR of any loan. The APR
includes both closing costs and rates.
Find The Right Lender
You should start your car loan shopping online, not at the
dealership. There are too many incentives for the salespeople
for you to be sure you are getting the best deal.
Start with a car loan broker site that brings many lenders
together. You can quickly access free quotes from there. Then
follow up with other lenders.
And don't give permission for a lender to access your credit
report unless you are pretty sure you want to go with their
offer. Otherwise, you will find that multiple credit inquires
will lower your score and hurt your loan application.
While there are no instant solutions to finding the best auto
loan rates, online sites do make it faster. A couple of hours
spent securing your vehicle financing will both save you money
and make the car buying process easier.
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