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  1. Do Not Apply Too Much:

Each time you apply for Finance, the Lender will access your Credit File and complete a credit check. An enquiry will be placed on your file with the Creditors name and the amount you are applying for .The enquiry will remain on your Credit File for 5 years and if you have a lot of recent enquiries ,it will reduce your Credit score and it will hinder your chances of an Approval. A lot of Lenders now have a Scoring Approval System where the number of enquiries will determine the Interest Rate which will be offered and in some case a loan may be declined because of excessive enquiries.

  1. Be realistic about how much to borrow:

If you are applying for Finance for the first time and wish to establish a Credit Rating, don’t try to borrow too much. If you are looking at buying a car,  keep you first lend to a suitable amount ,say $20000. The newer the car the better for a Lender as it is a lower risk for them and the Loan can be Financed over a longer term. Financiers get nervous when first time borrowers apply for a huge loan first up when they are yet to establish a Credit Rating. Remember, the more you borrow ,the higher the payment and the less you have to enjoy your quality of life. The last thing you want to do is default on a first time loan as Lenders will be more cautious for your second lend.

     3.  Get Good Advice:

As each Lender has different criteria in approving a loan, you need to get some good advice from someone who deals with these transactions every day: a Finance Broker. They can discuss the various Lenders who will give you the best deal the first time which will reduce the amount of enquiries you will have on your Credit File. They can also offer  you various Insurance Products to protect you and the car if it breaks down or is involved in an accident.

  1. Select the right Car:

Once you have looked at the first 3 steps, one of the most important steps is selecting the car of your dreams. Do some research ,look at the fuel economy, safety features and ensure the car is suitable for your applicable Licence as it is different in each State. The age of the car is a major factor to most Lenders as the older the car, the higher the risk to Finance .Most Lenders like to Finance cars that are not too old, a 5 year old car is perfect as you can extend the Loan out to 7 years which will reduce your repayments .A Finance Broker can “book the car “ for you to ensure you are paying the right price and you are getting the best deal. They can also check to ensure the car has not been written off or stolen.

  1. Have a budget in mind

Whenever you are buying something ,it is important to have in mind how much you can afford. It is no different when you are looking at buying a car, the second biggest investment you will make other than buying a house. You may be surprised when you budget for payments of $100 per week and think all you can buy is a $5000 car. Not true, in fact if the car is 5 years old, you will be able to afford a $20000 car which will get you a better reliable car which will last you a long time. It is always good to speak to a Finance Broker who can answer any questions you have such as these 5 points which will make your experience a pleasurable one.

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