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Tips to Get Auto Loan Approved with Good Interest Rate Part I

With the rise of the lending industry, it has become a lot easier for individuals to get auto loan and other finance facilities than it was a few years back. Although not much prominence is given to credit score these days, but it is still considered crucial in deciding the interest rate that is going to be charged off the borrower. On a simple auto loan, even a reduction in rate for about 3-4 percent can save up to hundreds of dollars. Therefore, it is best to know some tips which can allow an applicant to get a good interest rate.

In case the credit score is poor, the applicant might have to provide some sort of collateral to facilitate the auto loan process. The collateral can be any valuable item or asset such as another car, boat or any other prized possession. This ensures that the interest rate remains low but in case of a default, the borrower would lose his/her car and the collateral. Therefore, it is best to inform the lender regarding a probable default so that repossession could be avoided. You can also ask for some time out from the loan during which the money could be saved and the installments would be transferred to the end of the loan. However, all the earlier installments should have had been paid on time to ensure that the lender agrees.

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