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Credit Report Check Often Neglected During Car Loan

By Faye Mergel
Published: Wednesday, September 30th, 2009

Consumers often do not bother to check their credit report when purchasing a new car which is why clients fail to get the best deals for themselves, according to a private auto lending company. The report reveals that most consumers go immediately to car dealers without even knowing if there are debts in their accounts which they do not really owe.

Credit Report Check Often Neglected During Car LoanThe auto financing firm, which has multiple bases in the country, reveals that many consumers get very high interest rates because they do not bother to fix their credit report before applying for a car loan. The distributor says that it is the most common slip up that borrowers make when they apply for a new vehicle. Most often, clients do not know that a poor credit report warrants them higher interest rates and fewer options. Auto distributors do not grant expensive loans to high-risk consumers, the company says. The company adds that there are cases when a client does not even know his credit rating.

The car distributor tells borrowers that auto sellers do not always help clients get the best loan for them. They remind consumers that sellers want to make profit, and they take advantage of the opportunities they get through high interest rates.

Experts advise potential borrowers to review their credit reports from the three bureaus before going to any lender. It helps a consumer know which aspect in his debt management needs improvement, they add. More importantly, it prevents a person from getting higher interest rates for debts which he does not owe. The Federal Trade Commission says that identity theft has become more rampant than ever.

Having a good credit report from the bureaus can also help a person get lower auto insurance premiums, finance specialists say. They add that the way a person manages debt matters greatly to carriers since insurance is just another form of lending.

Debt advisers emphasize also the importance of keeping track of one’s records with the credit reporting agencies. They remind potential borrowers that tighter lending restrictions will make it more difficult to avail loans at present. Debt experts also warn consumers about bad credit auto loans since they may charge greater interest rates than one can handle. Advisers likewise warn them about applying for auto loan a little too often. Third party inquiries on credit report affect one’s ratings with the bureaus. They advise consumers to work on their credit reports a few months before they apply for any loan so they can get the best deals available.

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