- 1). Review your credit report to see if there are opportunities for improvement. For instance, if you notice negative information listed that you do not recognize, dispute the entry to have it removed, which helps boost your FICO score. If you have any issues to resolve, delay your plans to apply for a car loan until you resolve these issues.
- 2). Make a payment on all credit accounts to bring them up to date. Creditors commonly report accounts over 30 days late, so if you're near that threshold, make sure you take care of the payment before you attempt to apply for the loan.
- 3). Save up as much money as possible and offer the lender a higher down payment to get a good car loan. Put down at least 10 to 20 percent of the price of the car. If the lender notices that you're investing a significant amount of your own money, they might offer a better rate and at the very least you'll have a lower payment compared to putting no money down.
- 4). Apply for your car loan at a credit union instead of a bank. Credit unions tend to have lower rates and better loan packages compared to standard banks. Establish an account with the credit union if required. Otherwise, apply for a car loan at a number of places, preferably with an online quoting service, to get a wide range of interest rate quotes from potential lenders.
- 5). Ask if you can agree to make your car loan payments with an automatic withdrawal from your checking account in exchange for a better rate. Some lenders offer a discount on the interest rate if you commit to this type of arrangement.
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