Managing your credit is crucial if you hope to get the best rate on your car loan. Paying a few percentage points more than necessary can translate into shelling out hundreds, even thousands of dollars more than you should over the term of the loan. The added interest expense can also increase your monthly payment to the point that you no longer qualify for the car loan you want.
Manage Your Credit
One of the primary methods for managing credit is to stay on top of what the credit reporting companies have to say about you. This has the added benefit of making sure you aren’t the victim of identity theft. There are other benefits: your credit history affects your ability to qualify for a new credit card, or get a mortgage or other loan. And employers often check an applicant’s credit history and can eliminate you from the running for an important job if they don’t like what they see. Your credit history also helps determine the level of interest you pay on any given loan or credit card, which affects the overall borrowing cost.
There are numerous websites that offer free credit reports. However, many of us have discovered that most of these are simply using the offer of a free credit report as bait to get you to sign up for a service, charge a fee, or spam your email account with unwanted advertising. These websites end up being anything but “free.”
Michael Finney to the Rescue
I live in the San Francisco Bay Area. I was listening to the radio here last week when consumer advocate Michael Finney outlined a practical approach for managing your credit. Finney said he only recommends one website for free credit reports: www.AnnualCreditReport.com.
Once a year you can view and print your free credit report from any or all of the credit reporting agencies that operate AnnualCreditReport.com. These include:
After hearing Finney’s advice, I tried it myself. I successfully printed my free credit report without being scammed, spammed, or upsold a service I didn’t want or need.
Finney gave another consumer tip that I’m incorporating into the management of my personal credit monitoring. He said that to maximize your ability to watch over your credit history through the entire year, apply for your credit report through a different single company every four months. You will still qualify for a free annual report with each company listed above, but by spreading your request out to a single company every four months, you can monitor your credit history throughout the year.
More Help Saving Money
Readers of this website know that I recommend that you pre-qualify for a car loan through a financial institution other than a car dealer before walking onto their sales lot. Tomorrow we look at this and other ways you can protect yourself when financing a new or used car.