Washington, D.C. (PRWEB) June 28, 2006
With the summer wedding season in full swing, Americans Well-informed on Automobile Retailing Economics (AWARE), a national consumer education campaign, reminds newlyweds to follow the old bridal adage when deciding how to finance their first automobile together.
“Something old, something new, something borrowed, something blue is not just for weddings, it applies to financing a new car or truck, too,” said Eric Hoffman, a spokesman for AWARE. “And since buying a car or truck is often a couple’s first major joint purchase, it is important they learn about vehicle financing and talk to each other before deciding what to buy or lease.”
AWARE’s advice for newlyweds is to apply the wise wedding saying when financing their first vehicle together:
Something Old: An old-fashioned family budget: If you don’t already have a budget, now is the time to create one – together. Don’t forget to factor in vehicle related costs outside of a new car payment, such as insurance, maintenance and gas costs. Also, as a new couple, be sure to budget for other financial goals you may have, such as buying a house, ongoing education, or funding your retirement savings. Drawing up a comprehensive family budget will help you determine how much car you can actually afford.
Something New: A recent copy of both credit reports: If you are jointly financing your automobile, your credit history, and that of your new spouse, will affect the finance rate you are able to secure. Therefore, it’s a good idea to get a copy of both of your free credit reports so you’ll know what creditors are seeing when judging your credit worthiness. Go to http://www.annualcreditreport.com for your credit report.
Something Borrowed: Shop around for financing: There are literally hundreds of thousands of sources of financing for automobile purchases, such as banks, credit unions, financing companies, savings banks, loans from stock brokerage firms, and home equity loans. This has created a highly competitive marketplace and lower rates for all consumers. Virtually all 22,000 automobile dealerships offer the convenience of one-stop shopping through on-site financing offerings that assist consumers in securing financing.
Most dealerships work with five to 10 different banks or finance companies so that they can offer competitive deals to their customers.
Something Blue: Don’t let less than perfect credit give you the blues: If you are jointly financing your automobile and one of you has excellent credit while the other is credit challenged, understand how the finance company determines your annual percentage rate (APR). For example, some finance companies will only judge a couple’s credit worthiness based on the better qualified applicant. With a good payment history, this could present a good opportunity to help the credit challenged spouse improve their credit history over time. Other finance companies, however, may determine your APR based on both applicants, in which case you may want to consider applying for credit only in the name of the more credit-worthy borrower to secure a lower APR.
“These simple tips can really help couples before they buy their first car or truck together,” Hoffman said. “And remember, consumers have the ultimate power in any negotiation because the auto financing industry is so competitive multiple creditors will want your business.”
AWARE (http://www.autofinancing101.org) was formed to build a greater understanding among consumers about how auto financing works. The group aims to ensure that potential buyers of new and used autos have the tools and resources they need to successfully navigate the auto financing process. AWARE focuses exclusively on educating consumers on vehicle financing in a web environment free of advertising or lead generation sales tactics.
AWARE’s membership includes the following:
American Financial Services Association
National Automobile Dealers Association
National Association of Minority Automobile Dealers
American International Automobile Dealers Association
American Honda Finance Corporation
American Suzuki Financial Services
DaimlerChrysler Financial Services Americas
Ford Motor Credit Company
General Motors Acceptance Corporation (GMAC)
Group 1 Automotive, Inc.
Land Rover Capital Group
Mazda American Credit
National Auto Finance Company
Nuvell Financial Services Corp.
Saab Financial Services Corp.
Sonic Automotive, Inc.
Toyota Financial Services
United Auto Group, Inc.
Volvo Car Finance North America
Wells Fargo Auto Finance
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