How Are Dearborn, MI Car Loan Rates Determined?
Several factors contribute to your Michigan auto loan interest rate, including the loan amount, your credit score, your income, the car's age, the down payment, and the length of the loan (your loan's term). A high debt-to-income ratio, low credit score, or purchasing an older car from a dealer in Dearborn could mean a higher interest rate. But why is a high interest rate bad? The higher your interest rate is, the higher your monthly bill is and the more you spend in total. Just one or two percent more could mean you spend hundreds more on interest.
Is There a Way to Lower My Dearborn Car Loan Rate?
You can use tools like our Interest Rate Estimator to get an idea of what your rate might look like before you begin applying for auto loans in Dearborn, MI. If you've filled out your information and aren't liking the percentage you see, what can be done to lower it?
The loan term is one element you have total control over. Most Dearborn auto loans are available with terms in 12-month increments between 2 years (24 months) and 7 years (84 months). Longer terms attract many borrowers because they usually have a lower monthly payment. But longer terms are also likely to come with higher interest rates. If you can afford a bigger monthly payment, it's better to choose a shorter term. The Auto Payment Calculator shows what your monthly payment might be based on different interest rates and terms to help you determine what might work for your budget.
If you have less than stellar credit, raising your score could bring your interest rate down. Use our Guide to Better Credit for Auto Financing to better understand what determines your credit score and which steps you can take to bring it up fast. It may take some time and work to better your credit score, but it's all worth it for getting those lower auto loan rates in Michigan.
Putting effort into finding the right lender can also help you snag a lower rate. While lenders will use the same information, you won't receive the same interest rate from each one. Shopping around and comparing offers will help you find the best auto loan rate in Dearborn, MI — even if you don't have the best credit or income. You shouldn't automatically choose the first offer you get because there could be a better one right around the corner. Don't forget some lenders allow for negotiation, so you can take an offer from one lender to the next to see if they'll beat the interest rate.
Discover the Best Auto Loan Rates in Dearborn, MI with myAutoloan
myAutoloan is committed to helping you find the lowest auto loan rates in Dearborn, MI regardless of your credit score and the type of car you're buying. We'll present you with up to four loans at once so you can find the best deal. Simply complete our secure online application, select the best loan for you, and purchase a new ride from your {City}} dealer. Apply now to check today's lowest interest rates!