Getting The Best Deal On A New Ride

Getting The Best Deal On A New Ride

image of a red new carWhen purchasing a new or used vehicle, you want to be sure you’re getting the very best deal. The best deal on your trade, the best price for the vehicle you are buying and the best financing, assuring your lowest possible payment.

Let’s face it, dealers will ask probing questions about your trade and payment to make sure they squeeze out every penny of profit for themselves.

How can you tip the scale in your favor? Research is key when buying a vehicle so here are a few tips.

  1. Research your vehicle’s trade in value in two (2) or more places so you have a realistic average trade–in value starting out. Some great resources are kbb.com, nada.com and cars.com.
  2. Once you know the type of vehicle, narrow it down to a couple of makes and models that best suit your needs. Then research the best deals available. Some great resources are TruCar.com, Edmunds.com and Kbb.com.
  3. When purchasing a used vehicle, be sure ask the dealer for a Car Fax report and have a mechanic inspect the vehicle whenever possible. This will help avoid problems after leaving the lot.
  4. Finally, save more by financing your new or used vehicle at E&G Employees FCU. Our rate of 3.99% * and terms up to 84 months for new vehicles and a low rate of 4.49%* with terms up to 72 months for used vehicles, can save you more each month.

E&G Employees FCU helps members get the very best deal every day.

APPLY TODAY! 

* Rate assumes the member is eligible for lowest rate offered. Actual rate is determined by the member’s credit history. Application and approval by loans dept. is required. Call the credit union

How Many Credit Cards Should I Own?

How MANY CREDIT CARDS SHOULD I OWN?

 

Hopefully, you’re working hard at keeping that score high by using your cards and paying your bills on time. You may be wondering, though, if more is better. Should you open a few more and get more available credit? Or, are too many cards a liability to your score?  

Read on for the answers to all your questions. 

How your credit score works 

Before we answer the number of cards question, let’s explore the way FICO and other credit scoring agencies, like VantageScore, calculate that all-important credit score. 

Here are the major components of your credit score:

  1. Your payment history. The timeliness – or lack thereof – of your payments comprises 65% of your FICO score, making it the most important factor. VantageScore, another major credit scoring company, doesn’t share the percentages it uses, but it calls payment history “extremely influential” in determining your score.
  2. Your credit utilization. Credit scoring companies look at how much of your available credit you are using. A large amount of available credit – even in aggregate across multiple cards – is not always a good thing.
  3. The age of your credit. Next up on the list of influential factors is how long you’ve had your credit cards open. Lenders want to see a long and active history of credit cards and on-time payments.
  4. The kind of credit you have.  A variety of credit indicates that you are an attractive borrower.

The benefits of having multiple cards

Having one open credit card is not sufficient for achieving a high credit score. In order to give you the best shot at excellent credit, make sure you have several open cards. In the long run, having multiple cards can boost your score in two important areas:

  • Your payment history. When you pay several credit card bills on time instead of just one, this component of your score will go up.
  • Credit utilization rate. FICO likes to see a low credit utilization rate. This means that the more unused credit you have, the higher you will score in this area. Having multiple cards open will automatically increase your available credit. You’ll also be able to spread your credit use across several cards, further lowering your credit utilization rate.

The right number of credit cards

Are you waiting to hear that magic number telling you exactly how many cards you should have in for achieving and maintaining a high score? Well, unfortunately, there is no such “magic” number.

As mentioned, you do need to have several credit cards to increase your credit age and available credit, but there is no specific amount you should have. Instead, let’s take a look at the credit cards of consumers who have excellent scores.

The FICO high-achiever statistics track people with FICO scores that top 785. These statistics find that the average FICO high-achiever has 7 open credit cards. Of these cards, only four have outstanding balances. The average credit account is 11 years old and the most recently opened account is 28 months old.

So, while you may be quick to observe that several cards may be a good thing, consider the age of the cards in the wallets of high achievers. Perhaps lots of NEW cards won’t help you achieve excellent credit. Rather, a proven track record of on-time payments and responsible use of credit is the vital factor here.

When not to open new cards

If you’re planning on taking out a large loan, like a mortgage or an auto loan, within the next year, it’s not a good idea to start applying for new cards. Here’s why:

  • Hard checks on your creditEvery new credit card you apply for means another time your credit history gets pulled. Lots of “hard checks” can negatively affect your score – just what you don’t need before applying for a large loan. It may hurt your chances of approval and/or increase your approved rate.
  • Your credit age will decrease. The age of your credit is determined by taking an average age of all your cards. By opening lots of new cards, you’re bringing that average down and hurting your score.
  • Your credit variety will be lessened. Similarly, opening more unsecured cards with revolving credit will lower your credit variety, because you will suddenly have a much heavier amount of unsecured credit lines and less of other types of borrowings.
  • Too much open credit. While once considered a positive attribute across all credit scoring companies, the recent modifications to the VantageScore have changed all that. Lots of open credit will now negatively affect your VantageScore. This score is used for auto loans and other large loans; though most mortgage lenders currently only consider your FICO score.

Here’s the final word on having lots of open credit cards: If you’re just starting to build your credit and don’t plan on taking out a huge loan soon, it’s a good idea to open a few cards. Pay them on time and try not to go above 30% of your available limit on any of them. But, if you plan on applying for a large loan in the near future, give that card acquisition a rest and focus on using the cards you have responsibly.

Whichever category you fall into, remember to use your cards and pay those bills on time! The easiest way to do this is to make it automatic. Set up each of your credit cards to pay for a monthly bill. Then, set up your credit card bills to be paid automatically as well.

Keeping your credit score strong can have positive effects on your finances for years to come!

Top 10 Dos and Don’ts for Personal Loans

Top 10 Dos and Don’ts for Personal Loans

 

  1. Image of wallet with cash being taken out.Do use it to consolidate debt. Put all high-interest credit card debt and payday loans into one loan with a fixed rate, a fixed monthly payment and a closed-end term. You’ll save money and make debt management a lot simpler. Be sure to close any credit cards you pay off so you don’t rack up another large bill.
  2. Don’t use it to pay for your college tuition. Instead, go through Sallie Mae which you may connect to through E&G Employees FCU.
  3. Do use it to finance renovations on your home. Be smart about your renovations, though, and only choose those that will increase your home’s value.
  4. Do use it for moving expenses. Whether you’re moving cross-country for a job opportunity or another reason, a personal loan can help pay to transport your car, to move your belongings and to buy furniture for your new residence.
  5. Do use it to pay for large, unexpected expenses, like a funeral or adoption costs.
  6. Do use it to foot medical bills, especially for things that are not covered by most insurances such as fertility treatments, large dental treatments and cosmetic surgery.
  7. Don’t use it to pay for everyday expenses. If you find yourself doing this, you may be in financial trouble. Speak to a E&G Employees FCU representative for help with debt management and general financial guidance.
  8. Do use it to purchase a car, boat or RV.
  9. Do use it to take a dream vacation. Don’t do it twice a year, but a personal loan can help you finance your trip for a milestone anniversary or another special occasion that warrants an extravagant vacation.
  10. Do use it to pay for a wedding. A personal loan will give you more flexibility than a wedding loan.