Purchasing a house and car are two of the most stressful purchases you make as an adult. There is also a lot involved and as a consumer you always want to make sure you are getting the best deal.
One of the main things that can go wrong in a vehicle purchase is the financing. Car dealerships want the sale no matter what. This leads to a practice known as “shotgunning” where your credit application is sent around the financial world to a big group of potential lenders. These potential lenders ALL pull your credit which can lead to 5-10 inquiries on your credit reports. This drags your score down drastically.
You have a right to demand that this doesn’t happen. The best thing you can do is secure financing from your local credit union or bank. However, if you choose to go through the dealership know your score before you go in. Be honest with them and let them know if it is a high score or maybe a more average to low score. Knowing this information allows them to go directly to the lender who is most likely to approve. My last car purchase resulted in ONE credit pull because we walked in with a credit report, we told them what our score was and they knew which lender would take us right away. We got the best financing with no damage to our report.
So much of the stress of buying a car can be avoided by some work on your end before going in. Consumer reports can give you an idea which cars are going to be reliable and long lasting. You can easily shop around for fair pricing using sites like Autotrader as well. Plus everything is negotiable when it comes to price.
Preparing financially can make for a smooth effortless transaction as well. Have financing in hand from your lender walking in or have your credit score/report and discuss which lender has the best options for you with the finance department. Don’t just go along for the ride and let the dealership run the show. They are there to serve you whether or not it feels like it. Stay in control of the situation, always be willing to walk away from the deal if it goes south and protect yourself financially for the future by not letting your score be dragged down needlessly.
Click the link below for information on how you can protect and improve your credit
Originally posted 2014-03-26 16:01:56.