Six Common Myths About Auto Loans

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There are a great number of myths going around about auto loans, but few of them are true.  In fact, just like other modern myths, there is probably more false than correct when it comes to the rumors about shopping for auto loans.  The truth about auto loans is far more logical and optimistic than most people would expect.  Here are the facts that dispel the fiction of six common myths about auto loans.

Myth #1: I Don’t Qualify For A Loan

You might be surprised.  There are lenders that specialize in people with no credit as well as lenders that work specifically to sign auto loans for those with bad credit.  There may be some give and take when it comes to how much you can borrow and what kind of down payment you need, but it is never a wise choice to speculate when you can easily get the facts.  Search online to find out what lenders are willing to offer you an auto loan, it’s never been easier!

Myth #2: Loans Cost Too Much

Some people feel that loans cost too much in terms of fees and interest.  While lenders do need to make money in order to be a viable business, this myth is largely a leftover from people shopping amongst only a few major banks that essentially controlled their local markets from coast to coast.  The Internet has completely broken this lending embargo, allowing for competition to flourish.  Anyone that has even a basic grasp on economics knows that when supply increases dramatically and demand remains the same, prices drop in response.

Myth #3: Nobody Wants to Lend to Me

This is perhaps the most common misconception of all.  The truth is that there are literally thousands of lenders from coast to coast, and many of them specialize in very specific types of situations.  You may feel that you have made a few mistakes in life, and perhaps you have, but that does not mean that you are alone.  In fact, there are probably a million people out there driving vehicles that they got an auto loan on that have messed up worse than you could even imagine!  The bottom line is that you need to broaden your search to include the most lenders possible to increase your chances and the Internet is just the tool to accomplish this job.

Myth #4: I Only Have Local Options

This myth is obviously completely and totally false.  There is an entire country full of lenders that are, as previously stated, always looking for their next business opportunity.  Never, not even for a second, consider your auto loan options to be limited.  Doing so only limits your choices and opportunities, so free yourself of this mental roadblock and enjoy a sea of opportunities that awaits you!  Remember, more choices means better deals too, so be on the lookout for the best deals.

Myth #5: My Credit Takes Too Long to Fix

Fixing credit is easy and really does not take very long.  The entire process starts by getting to know your credit and understand the factors that contribute to it.  Learn everything you can about credit and start fixing it immediately and you will be surprised just how quickly it can be repaired.

Myth #6: I Should Pay More Than The Minimum Payment

This myth may or may not be true depending on a few factors.  First off, many lenders have a clause in place that enables them to take additional payments and apply them towards your final month(s) payments if and when you reach a certain limit.  This means that paying more than the minimum may be good to a point, reducing your monthly payments, but only to a point.  Additionally, paying off an auto loan without demonstrating responsible payments for a few months may work against you when it comes to your credit.

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