Whether you are planning to purchase a brand new car or a pre-loved one, you have to consider how you are going to pay for the vehicle. Are you going to pay in cash, apply for a bank loan, or secure financing from institutions such as TYG Finance? Here are some steps that you can follow in purchasing your car through financing.
Know Your Budget.
You should first determine how much budget you can afford to set aside for purchasing your car. You can figure out your budget by writing down all the things that you spend money on each month. These include rent, insurance, groceries, gas, and all your other essential monthly expenses. When you subtract all your monthly costs from your monthly income, the difference will be the amount of money that you can afford to pay monthly for your car.
Know Your Credit Score.
Knowing what your credit score or rating is essential so that you may know how much credit you can get from a bank or financial institution such as TYG Finance. If you have a good credit score, it will show financial institutions that you can meet your financial obligations. With a good credit score, you will most likely get a loan. You can check your credit score for free using different credit score websites.
Ready Your Documents.
Whether you are planning to get financing from a car dealer or a financial institution, you need to have all your documentation ready. You should bring your driver’s license, especially if you are going to be test-driving the car you want to purchase. You should also bring your proof of insurance to let the car dealer know that you are safe to drive. For the financing part, you are going to need to show your latest pay stubs, which may include utility bills under your name, your list of debtors, and references. Financial institutions require a list of references so that they would have a list of people who know you when they can’t get a hold of you.
Do You Need a Co-signer?
You may need to have a co-signer if you have a low credit score. You will also need to provide a co-signer if you do not have a credit history. If you are required to have a co-signer for your car financing, you should choose someone who has a good credit score, a good income, and a good debt-to-income ratio. You also must ensure that your co-signer has good money coming in because it will be the obligation of your co-signer to take over your loan in case you failed to pay it.
Get Pre-Approved for a Loan
To get pre-approval for a car loan, you have to undergo the process of filing for an application first and knowing what type of car you are applying the loan for or at least know the car’s price range. If you get a pre-approval, you get a letter stating that you are approved for a car loan within a specific term and interest rate and how much you can walk out of the door with.
Know What Vehicle You Want
When you already have a pre-approved loan from a TYG finance institution, you can now go to your favorite car dealerships to choose a vehicle that will fall within your pre-approved loan budget. When choosing a car, it is good advice to know the type of vehicle that you are getting and at least to compare prices with at least three other dealers to get an accurate, fair market value. If you are purchasing a second-hand car, check the vehicle’s history thoroughly and find out what the trade-in value of the vehicle will be after three years.