Auto Finance

The Auto Finance Puzzle: CarZing Puts the Pieces Together

By TheCarzingTeam April 19, 2021 | Auto Finance

Auto Finance

That feeling you get when you have the keys to your dream car in hand…there’s nothing quite like it. Unfortunately, however, auto financing can seem like one big puzzle that’s blocking your way. When buying a car, the “game of loans” can seem just as complicated and dramatic as the TV show of a similar name. The maze of loans, lenders, rules, and credit requirements can be confusing. CarZing has established themselves as a leader in helping car buyers navigate these financial complications and is committed to bringing more transparency, resources, and answers to the car buyer.

The auto loan puzzle’s primary pieces are the amount you want to borrow (principal), interest rate, (Annual Percentage Rate or APR), and the term, which is the duration of the loan or how many months you have to repay. The amounts of these three factors will vary and are based on the car buyer’s credit score, employment, income, residency, & auto ownership history.

The CarZing Solution (or CarZing’s Solution) can make your car loan application process easier, helping you put the pieces to the finance puzzle correctly in place. Get pre-qualified today, customize your monthly payment and down payment, browse cars for sale in our inventory, and you could take home your vehicle today!

Determining Your Credit Scores

When applying for a loan, most applicants can validate employment, income, residency, etc., but credit scores are typically the least understood element. A credit score, or FICO score, takes your credit data and groups it into 5 categories: payment history, amounts owed (also known as “credit usage”), length of credit history, new credit, and credit mix (“mix” meaning different account types such as credit card, auto loan, etc.). The credit reporting agency (Experian) then calculates your credit score based on these 5 categories.

Experian explains that payment history is typically the most important category used in calculating your credit score. Within this category, the scoring model considers on-time payments, late payments, and public records. Generally, a credit score falls in the range between 300 and 850. An acceptable credit score hovers around 600 to mid-600, however, the range of acceptability does vary.

The credit score is the focal point of a person’s credit report and that report is what is provided to lenders and other entities, upon request. When a car buyer goes to a dealership to buy a car, they fill out the application and the salesperson goes “behind the curtain” to run the credit. This is a formal request to the credit agency so it is considered a “hard” credit application and can/will impact the buyer’s credit.

Dealerships will shop a car buyer’s hard credit application and other personal information to multiple lenders and those lenders, in turn, present the principal, apr, monthly payment, and term for the loan they are willing to extend to this buyer.

Since the buyer is not actively involved in this process, it can be somewhat of a mystery and therefore may breed a level of mistrust. Perhaps you’ve found yourself in this very situation of waiting patiently, anxiously for the salesperson to return with your credit verdict. Often is the case, your expectation of price, loan amount, monthly payments, & down payment differ from your initial expectation and it can seem like the position of power has shifted to the dealership.

No matter the situation or circumstances, wouldn’t it be better to understand how the puzzle pieces are determined so that you can be more confident throughout the process.

CarZing Lets You Put the Pieces Of Your Auto Finance Puzzle Together

CarZing allows the car buyer to put the pieces of the puzzle together before they even set foot in the dealership. The platform pulls back the curtain on the dealership’s credit application process by allowing the buyer to participate and initiate the credit application process.

On CarZing, the buyer provides some basic personal information used to generate a “soft” credit-pull through Experian, without affecting the customer’s credit, unlike a hard credit-pull application. The buyer’s soft credit pull and information get instantly submitted to preferred lenders, just like the dealership does. The customer’s lending decision results are then applied to inventory on the website to produce a pre-qualified decision for each vehicle.

These decisions reflect all of the puzzle pieces needed including price, principle, APR, monthly payment, and term. You can also adjust down payment, term, or monthly payment to best fit your budget. When you’re ready to schedule a test drive or if you have any questions, a CarZing specialist will be available to help. All prequalified offers can be printed so that you will have them with you in hand when the time comes.

CarZing makes the loan application process easier, stress-free and lets you put the pieces of the auto finance puzzle together. When shopping for your next vehicle, let CarZing help guide you through the process.

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