Take Advantage of Your Employer’s Low Interest Auto Loan

Finding low interest auto loan arrangements is no easy task for the ordinary car buyer. Many of us rely drastically on loans and credit, and lenders normally charge outrageous interest rates on everything we take a loan for. This is true for car buyers seeking assistance, especially those who cannot get favorable credit approval or attain a preferred lender. Although there is such a thing as subprime lending where loans are granted to borrowers with previous credit problems, note that these loans have higher interest rates. Why? Because you are considered a ‘high risk’. Be prepared too to reveal information about yourself as lenders normally do a routine check into your credit background. Do you have payment delinquencies? Charge-offs? Ever declared bankruptcy? All these make you a high risk and lower your chances of getting a low interest car loan.

This does not mean that there are no good subprime lenders out there. But do proceed with caution. Many lenders nowadays lure borrowers into their “low interest financing” schemes by simply flashing a lower-than-average APR on their stores or online websites. Of course, clueless as we sometimes are, we take the bait. Even if the financing arrangement promises a low interest, the end result could be drastic. What many of us don’t know is that many of these promises have adverse effects each time we make a loan amortization. We think that our monthly payment is low but if our car loan is good for 10 years and there’s an extremely high pre-payment penalty, you can be sure that the low interest on your financing up-front saves you nothing in the end.

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