Tip of the Day
When shopping for a car, shop for a loan before you visit a dealership or bid for a car over the Internet. After reviewing your credit report to correct errors, ask your bank and several other lenders about their loans and costs so you are in a better position to get the best possible terms. If you're a homeowner, you could also consider using a home equity loan or line of credit instead of a traditional auto loan, but remember, you could lose your home if you can't repay the loan.Know what car dealers are offering in terms of financing by reading their advertisements, making phone calls or checking the Internet. Many dealers offer discounted loans (such as zero-percent financing) or cash rebates, but not both. "In some situations, it may be better to accept the dealer's rebate and pass up the zero-percent financing in favor of a loan from a bank that does charge interest," said Joni Creamean, an FDIC Senior Consumer Affairs Specialist.