It’s time to buy a car, but your credit is not in the high hundreds. What do you do? For many people, you go into the dealership hoping for the best. If you are lucky, you walk in with a pre-approved loan and don’t have to settle for the financial options offered by the dealership. But most people go in and take whatever deal is offered to them, not realizing they are paying an even higher price for that new car than they thought, as the dealership passes the high fees on to the consumer. They aren’t supposed to do that, but it happens, and often the costumer is unaware that they have just acquired a new loan with a new set of fees attached.
There are ways to get around this problem, even for those with shaky credit. One is the aforementioned pre-approved loan. This means your bank or credit union has approved a loan for your car up to a certain amount, and all fees and interest rates are already set and known. Another is to buy a used car, instead. In fact, avoid car dealerships altogether. The summer is an especially good time to find great deals on excellent used cars and you can find those deals online through sites like Craigslist.org or other retailers. If you can pay in cash, so much the better. Then there’s no loan, no fees and no interest rate and you own the car outright.
And if nothing else, raise your credit or don’t buy an expensive car. Both of these apply to most people, since having better credit is nearly always a plus, while buying a less expensive car (buying what you need, not a luxury car) can only reduce your costs in the long term.