Are you considering buying a car in Alberta?
Make sure to read this!
Where there is money, there can be a scam. Auto loan credit is no exception. Getting an auto loan is definitely a challenge but sometimes, people fall into traps of spending extra thousands of dollars because they fail to notice a scamming scheme.
You may not be aware of it at first but it can cause headaches in the long run. If you’re one of the thousands who are not sure what to look for in applying for a loan, here are three signs you need to avoid in order for you not to be taken advantage of by scammers.
- Beware of Loan Markups
- Inexperienced buyers usually fall victim to lenders that offer interest rates which are higher than they are qualified for.
- If you’re not aware of what interest rate you should pay for before applying for a loan, you could end up paying compounded interest over long years.
- Even something as small as a 2-4% markup could result in thousands of dollars scammed out of you.
- Simply researching and knowing first how much you should pay for interest before you apply ensures that you are not being one-upped by the lender.
- Watch out for Hidden Fees
- Collectively called as ‘packed payments’ this common scam is another trick that lenders may try to pull off.
- Hidden fees such as extended warranties, extra services and products, insurances may lurk somewhere in your loan term.
- Fees like these may not seem like much since they are spread throughout the entire term, when added up, it could cost you more expenses than you bargained for.
- Make sure to read through the terms of your loan research first what necessary fees you have to pay and unnecessary ones that you don’t really need.
- Lying About Your Credit Score
- While uncommon, sometimes lenders do lie about your actual credit score.
- Inexperienced buyers fall trap to this because they perceive lenders as absolute authorities of the trade.
- Lenders may sometimes sweet-talk you to a higher interest terms simply because they lie about what your credit score is.
- Avoiding this scam is just as easy as finding out about your credit history and score.
Educating yourself on the tricks that scammers use will definitely help you become aware when it is being used on you.
The best tip is to research all you can before applying for a loan and asking friends who have already experienced applying for one.
And when you’re ready to apply for an auto loan, you can submit an application with New Car Canada. It’s fast, easy and reliable!