It’s always exciting to bring home a new car or motorcycle, but there’s more to your shiny new toy than excitement. On the flipside, you have to consider several financial elements of owning a new vehicle.
If you want to make a wise purchase, you’ll spend time preparing yourself and your bank account for this epic purchase. Here is a brief look at some tips that will help you prep your personal finances to purchase a new motor vehicle.
Decide what you want to purchase
The first step to your new ride is to decide. Decide what type of vehicle you want to purchase. Look into various options, and spend time investigating all the specs.
If you’re looking at a Honda motorcycle for purchase, consider the reliability a perk. You may want a family vehicle, and an SUV may seem more suitable. Now is the time to take all factors into account.
Clean up your credit history
Once you’ve set your sights on a specific vehicle, you should take some time to look at your credit history. Your credit score is one thing, but the specifics of your credit history will tell you more about your financial situation.
Make use of technology, and download the Credit Karma mobile app to get a comprehensive layout of your financial background. Once you’ve seen everything, decide where you can make improvements. This part of the process may take you some time, so have patience.
Save money for a down payment
It’s likely that your financial agency will require you to put some money down on your vehicle purchase. It’s wise to save at least ten percent of the total cost of the vehicle you have your eyes on purchasing. With a comfortable down payment, your financing options will expand.
Take a good look at your finances
While you’re in the process of completing the first three steps, make it a point to keep a watchful eye on your finances. You will need to know just how much you can afford to pay out for a payment each month, so you don’t place yourself in a sketchy financial situation.
Get approved for a loan
If you’ve done the legwork to improve your credit score/history, then getting approved for a loan will be a much more comfortable process. Otherwise, you may have to shop around for a lender that is willing to take a risk on a less than excellent financial profile.
When you’re shopping around for the best deal from lenders, consider interest rates. Interest rates can make or break a deal, so don’t let the what’s in the fine print escape your attention.