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Rent prices are the talk of the town lately, and with good reason. After all, they have been steadily outpacing wage increases for the better part of four decades. But recently they have been increasing at an even more alarming rate. Rent prices have never been higher, and they just keep going up. But why now, and what can we do to help our finances keep up?Today we are talking about why rents are increasing and what steps you can take to create more room in your monthly budget.Why is rent increasing?Rents have steadily been increasing and outpacing wages for decades. In fact, the average rent has increased 149% since 1985 while income grew by just 35%. That means rent has been increasing at a rate that is nearly five times faster than income. The rule of thumb when it came to budgeting used to be simple: pay 30% or less of your income on housing costs. But this rule is nearly impossible for people who make under $30,000 a year to follow. After all, that would mean finding an apartment with rent and utilities for under $750 a month (compare that to the national average for a one bedroom apartment which is $1169). Even with roommates that is a difficult undertaking with the soaring costs of rents. From March 2021 to March 2022 the average rent rose 17%, while wages only increased by 6%. This disparity has a compounding effect, creating more and more of an issue for renters every year. It is only becoming harder and harder for people to pay their bills every month.  Let’s look at a few of the reasons rent has been soaring lately.The pandemic created more competition in the rental markets.The pandemic had everyone stuck in their homes–and therefore stuck with their housemates. This caused many people to want their own space. Young adults wanted to move out of their parents’ homes, people with roommates wanted an apartment of their own, and many couples broke up and needed their own space.According to US census data, the amount of US households grew by 1.48 million last year. That is a huge increase in the amount of homes and rentals needed in the United States. All of these extra households created more competition in the rental market, leading to higher rent prices across the country.We have been underdeveloping housing for over a decade.A decade of lax development has finally started to show its face. After the 2008 crash, many homebuilding companies slowed their development plans. This resulted in nearly fifteen years of housing development being outpaced by the growing population. Housing units that were built were aimed at the wealthy–luxury condos and high rises were being built in lieu of affordable housing options. This was only exacerbated by the pandemic, where a shortage of workers and materials caused a further drop in new construction. While the demand for housing has been rising, the supply has been unable to keep up.An increase in mortgage rates made buying more expensive.Mortgage payments have increased an average of 6% since the pandemic, which equates to hundreds of extra dollars a month. On top of that, the housing market is becoming increasingly more expensive. The median sale price of an American home recently hit a record high of $346,900 according to the National Association of Realtors. The price of single family homes increased 18% in 2021 alone. This means that many Americans are simply being priced out of buying a home, and renting is their only option. Would-be homeowners are adding to an already crowded rental pool, causing more demand and higher rent prices.Rent freezes have expired.Many cities and states put rent freezes in effect early on in the pandemic. Now that those freezes have expired, many landlords are adding in two years worth of rent increases at once–essentially trying to make up for what they feel they lost. But this is a huge hit to renters who are having their rents raised by hundreds and hundreds of dollars. New renters with deep pockets.New renters entering the market with a lot of disposable income are also driving up the rental markets. The pandemic brought on a wave of new work from home opportunities, allowing people with very well paying jobs to work from anywhere. Instead of being confined to the big cities, white collar workers with high paying jobs could suddenly relocate anywhere, affording larger and more luxury apartments outside of New York or San Francisco. This brought more competition to smaller cities and towns. This wealthier demographic is changing the rental game in a lot of ways, adding more fuel to the fire.How long will rent increases last?With so many factors affecting the rental market, it is hard to predict exactly how long rent prices will keep climbing. It will depend a lot on if supply and demand can level themselves out. If new construction can create more affordable units, that will help a great deal. Similarly, if potential homebuyers can actually buy homes instead of being outpriced, that will help the rental market as well. Unfortunately that seems unlikely as economists predict that home prices will continue to rise into 2023. Either way, many economists predict that the rental market will revert to its typical 3.5% growth after 2022. How can you save extra money every month to pay rent?While we cannot control rent hikes or cost of living increases, we can control our budget. Cutting our expenses here and there is one way we can help to offset the increasing rent prices and help make ends meet.Focus on your credit scoreIncreasing your credit score is always a good idea, especially when financial times are difficult. Having a good credit score is important for a lot of reasons. A good credit score can help you:Get you approved for a mortgageGet higher credit card limitsGet approved for a car loanBut in addition to opening you up to more lines of credit, a good credit score can actually save you money.It can get you lower car insurance paymentsIt can help you get a better car loan rateIt can help you get a better mortgage rateIt can help you get better credit card ratesAll of this can add up to hundreds if not thousands of dollars of savings every year. There are some simple steps you can take to increase your credit score. Making full, consistent, and on time payments is one of the best ways you can help your credit score. Focusing on paying down any debts and increasing your lines of credit can also help give your credit score a boost.Refinance your car loanRefinancing your car loan can give you a little (or a lot) of extra breathing room in your budget every month. It can cut your monthly loan payments in a few ways.Refinancing to a lower car loan APR will automatically reduce your monthly payments. But refinancing and selecting a longer repayment period will allow you to repay your loan over an extended period of time. That can reduce your monthly payments drastically. Let’s say you have $20,000 left in your car loan. Even if your interest rate remained the same at five percent, refinancing from 36 months to 60 months will reduce your monthly payments by over $170. And that can really help make up the gap with rent increases.Stick to a budgetA budget is your best tool for keeping pace with rent increases. It is so important to keep track of your incoming and outgoing money, as it will tell you exactly what your financial state is. Making a budget doesn’t have to be complicated. Simply track your income, track your expenses (take an average of any expenses that vary) and see how they line up from month to month. If there are any categories that seem too high, like subscription services or grocery bills, see where you can make some cuts. Try canceling any services you don’t use a lot, start buying generic brands, and sign up for any rewards programs that can give you extra savings.That’s why rent prices are increasing and what you can do to create some extra room in your budget.It’s hard to say when the rent increases will slow down, so it’s important to be smart with your money today so you don’t have trouble in the future. Creating a solid budget, working to increase your credit score, and refinancing your car loan are all great steps you can take to help handle the rental increases.If you have a car loan, there’s a good chance you are overpaying every month. To find out how much money you could be saving, get in touch with Auto Approve today. Our refinance experts can help guide you through the process and start saving you money immediately.Don’t wait–get in touch today!GET A QUOTE IN 60 SECONDS

There’s so much to do every day, most of us want to avoid adding another thing to our to do list. Between work, home, and our families, there’s already a never ending list of things we should be doing. But when it comes to refinancing your car loan, there are a lot of benefits that may make it worthy of your to do list.Here’s why refinancing a car loan is worth it. When should you refinance your car loan?Refinancing a car loan can save you a lot of money. But there are times when refinancing a car loan will make more sense than others. Here’s when you should think about car loan refinancing.When market rates have decreasedCar loan refinancing saves you money by reducing your car loan APR, which reduces the overall amount you will have to pay back. It will also decrease your monthly payments. If the market rates have increased a lot since your initial financing, you might have a difficult time qualifying for a lower car loan APR. But if the market rates have decreased since your initial financing–and there’s a good chance they have–then you will most likely qualify for a lower car loan APR.When your credit score has increasedIf your credit score has increased since your initial financing, you will most likely get a much lower car loan APR. And that can translate to a lot of money in savings.Your credit score is based on a number of factors. While some factors affect your score more than others, an increase in any area can cause an increase in your credit. The five areas that affect your credit score are: Payment History (35%) This looks at your history of making full and on time payments. Amounts Owed (30%) This looks at the amount of money you owe compared to how much credit you have available to you.Credit History Length (15%) The age of your credit accounts. A longer credit history is more favorable to lenders.Credit Mix (10%) Having a diverse assortment of accounts is beneficial to a high credit score. A healthy mix might include a mortgage, auto loan, student loan, and credit cards.New Credit. (10%) The number of new accounts you have opened plus the amount of hard inquiries you have had on your credit account for 10% of your credit score. If you have paid off some debt since your initial financing, or have been more consistent with your payments since then, it could have a huge effect on your credit score. Your credit score is the biggest factor that you have control over when it comes to what car loan APR you will be offered.When you need extra breathing room in your monthly budgetIf you qualify for a lower car loan APR, your monthly payments will automatically decrease. But refinancing can allow you to decrease your monthly payments even if you are unable to qualify for a lower car loan APR. By lengthening your repayment period, you can stretch out the amount you have to pay back over a longer period of time. This will reduce your monthly payments drastically. Instead of dividing your payments up across 36 months, you can divide them up over 48 months. This can give you a lot of breathing room in your budget every month.When you need to add or remove a cosignerIf you want to add or remove a cosigner, refinancing is the only way to do so. Let’s say you originally financed a car with a loved one because your credit wasn’t the best, but now you have increased your score through a lot of hard work and do not need any additional help. Refinancing can help you take ownership of your loan and let your loved one off the hook.Conversely, if your credit score has slipped a bit but you really want to get a lower car loan APR, adding on a cosigner can help you do so. Lenders will look at your scores and credit history together, allowing you to get a lower car loan APR than you would be able to get otherwise.Does refinancing a car hurt credit?If you have worked hard to get your credit score higher, you may be anxious to refinance out of fear that it will lower your score. The good news is that there is only a small upfront dip on your score, and in the long run refinancing can actually help you increase your credit score.Refinancing will affect two categories of our credit score, your credit history length and your new credit. A new account will negatively affect your credit history length, and the hard inquiries and new account will also affect the new credit category. Keep in mind that this will only affect your score for a year, as hard inquiries are erased after one year. Submitting all of your applications for car loan refinance at one time will help minimize any damage to your credit score. Credit agencies know that consumers need to shop around and submit more than one application, so they allow a fourteen day window where all credit inquiries will consolidate and count as one singular hard credit inquiry. This is another reason that using a company that specializes in car loan refinance, like Auto Approve, can prove advantageous. They can apply to multiple lenders in a short time frame so that everything will be considered as one inquiry. If you are trying to refinance on your own, you may inadvertently space out your applications too far and hurt your credit score.But refinancing your car loan can help your credit score in the long run. It can help by:Reducing your monthly payments. If your car payments are lower, you will have an easier time making sure you don’t miss any payments you can’t afford.Helping you pay off debt. More money in your pocket means more money you can use to pay off other debts. Lowering your credit utilization ratio can have a very positive effect on your credit score.Car loan refinancing might cause your credit score to dip slightly in the beginning, but it can be worth it in the long run and can help ease a tight financial situation.How do you refinance a car loan?If car loan refinancing seems like a good idea, there’s good news–refinancing a car loan is super easy. Using a company that specializes in car loan refinance, like Auto Approve, can make the process quick and pain free. ResearchBefore you do anything, you want to be as prepared as possible. The biggest thing you want to be prepared with is your credit score. Request a copy of your credit report (you can do this once a year with each of the three major credit bureaus, so essentially three times a year). Make sure that your score is in good standing and that there aren’t any errors or inconsistencies on your report. You also want to be prepared with your existing loan. Look at your current loan contract and make sure you are aware of any penalties for which you may be responsible. Call your lender directly if you have any questions. If you are unsure about any of the fine print, it’s always a good idea to double check with your lender. Apply Applying for a car loan refinance is similar to your original financing application. You will need the following to get started:A Photo ID, such as a passport or driver’s license.Your vehicle’s information, which may include the bill of sale, VIN number, make, model, and year of your car.Proof of income and financial history, which may include pay stubs, banking information, and your credit report.  Proof of residence, such as a mortgage statement, lease agreement, or utility bill. Note that PO boxes are not acceptable as proof of residence.Proof of insurance. Gather all of your information and scan it so it is easy to attach to your online applications. If you use Auto Approve to refinance your car loan, they can handle all of the applications so you don’t have to.CompareOnce your applications are submitted, it won’t take long for the offers to come rolling in. Compare all of your offers (Auto Approve can help you do this) and decide which lender is right for you. Sign and Start Saving MoneyThat's it! Once you have picked the best car refinancing option, sign on the dotted line and start saving money immediately. And if you use AutoApprove for refinancing, we will even handle the DMV paperwork so you don’t have to.And that is why refinancing your car loan is worth it.Refinancing a car loan may sound complicated, but it is actually really easy and can pay off tremendously in the long run. And if you use Auto Approve, refinancing is a breeze. So why wait?GET A QUOTE IN 60 SECONDS

Car refinance can save you a lot of money in the long run, but exactly how much can you save? With the cost of everything going up and up these days, every penny counts. And we know that hypothetical savings don’t mean that much: our customers want to know just how much money they can save with vehicle refinance. That’s why we have a free, easy to use loan refinance calculator on the Auto Approve homepage to help you start to figure out how much you could be saving when you refinance. All you need to do is plug in your loan information, and our calculator will take care of the rest!Here’s how to use our car loan refinance calculator, and how you can decide if you should refinance your car loan.How to Use Our Car Loan Refinance CalculatorTo determine exactly how much money you can save with car refinance, you can use our car loan refinance calculator available on our home page at autoapprove.com. Using our car loan refinance calculator is super simple. You will just need some basic information:Your remaining loan amountTime left on the loanYour current APRYour new APRBy simply plugging in this information, you can see exactly how much money you might be able to save with a car refinance. For example, let’s say you have a loan with a balance of $35,000. You still have four years, or 48 months, left to pay it off. Your current APR is 10%, but you have been approved for a new rate of 2.25%. By simply plugging all of this in our loan calculator, you will find that a refinance will save you $5,977.74. Here’s what it looks like:Simple as that! While the calculator doesn't factor in your credit score and can't guarantee you'll get the refinance you're looking for, it's certainly a good start! And if you want to get a more complete and accurate picture of what you might be able to save, you can always get a free quote – it's fast, easy, and there's no credit check or obligation to get a quote.How Does Car Loan Refinance Work?So what exactly is auto refinancing and how can it save you so much money? Auto refinancing is when you pay off your existing car loan with a new loan, a loan that ideally has a lower APR and better terms overall. When you lower your APR, you can save a lot of money in interest every month. And if you refinance to a reduced repayment period, you can save money by reducing the amount of time that you will be paying interest.You can refinance your car with a number of lenders. From credit unions to traditional banks to online lenders, there is an unending list of places to apply. But using a company that specializes in car refinance can make your life much easier.At Auto Approve, car refinance is what we do. We have relationships with lenders across the country so we can secure you the best APR and best terms for your refinance. All you need to do is fill out some basic information and we will handle the rest! We even handle the paperwork so you don’t have to. Our refinance experts can help guide you through the process and ensure that you are getting the best deal possible (and therefore saving the most money!)What are the Benefits of Car Loan Refinance?If you’re wondering “should I refinance my car loan?”, you should consider the benefits of refinancing. If any of the following apply to you, it might be worth considering a car loan refinance.You Can Save MoneyThe main reason people refinance their car loans is to save money. And with how expensive everything is right now, saving money is the name of the game. By refinancing your car loan to a lower rate, you can drastically reduce the amount that you are paying in interest. You can also save money in the long run by refinancing your car loan and decreasing the repayment period. For example if you reduce your repayment period from 48 months to 36 months, you will cut out an entire year of paying interest. And that can add up to big savings. You Can Reduce Your Monthly PaymentsIf you reduce your interest rate, you will automatically reduce your monthly payments. But you can also reduce your monthly payments by lengthening your repayment period. If you change your repayment period from 36 to 48 months, you will stretch out your repayment by twelve months and therefore reduce your monthly payments. You will end up paying more money in interest in the long run, but depending on your financial situation, lower monthly payments might be more beneficial than long term savings.You Can Add or Remove a CosignerIf you originally had a cosigner on your car loan but no longer wish to have them on the account, you will need to refinance your car loan to remove them. On the other hand, if you would like to add on a cosigner, you will also need to refinance your loan. Since loan terms and APRs are highly dependent on the applicant’s credit score and financial history, removing or adding a person will affect the probability of a loan being paid back in full and on time (in the eyes of the bank at least). Refinancing your loan is the best way to adjust who is listed on your loan.When Is a Good Time to Refinance?The best time to refinance depends in part on your personal finances and in part on the market at large. If any of the following apply to you, it might be time to consider refinancing your car loan.When Your Credit Score Has IncreasedThe APR that you are offered will depend a lot on your credit score. Your credit score is an indication to lenders of how likely you are to pay back your loan in full and on time. The higher the credit score, the more likely lenders will consider you to pay back your loan. Credit scores are broken down into the following brackets:800 to 850: Excellent credit740 to 799: Very good credit670 to 739: Good credit580 to 669: Fair credit300 to 579: Poor creditThe best APRs are reserved for those with excellent and very good credit scores. Taking the time to improve your credit score can pay off in the long run (If you’re looking to improve your credit score, check out our blog post on 8 simple tips to help your credit score).When You Need Some Extra Money Every MonthIf you find yourself struggling to pay your bills every month, refinancing your car may help ease your monthly burden a bit. By securing a lower car loan APR, you will save money every month. But even if you do not qualify for a lower car loan APR, refinancing can still help lower your monthly payments.The car loan that you currently have cannot be easily adjusted. You cannot decide to change the repayment period to adjust your payment amounts. But when you refinance your car loan, you can change the repayment period. So instead of paying off your car in 36 months, you can decide to pay your car off in 48 months. This means that you can repay the same amount over a longer period of time, therefore reducing the amount you are paying every month.While you will end up paying more money in the long run because you are paying interest for a longer period of time, it may still be worth it to consider. Refinancing to a longer repayment period can provide a lot of relief to an overworked budget.When the Market Rates are LowThe car loan APR that you are offered will depend in part on your credit score and financial history. But the market rates are another major factor in the car loan APR you will be offered. Today’s rates are still much lower than they were in previous years, making it the perfect time to consider vehicle refinance.When Is It Not a Good Time to Refinance?There are times when it will not make sense to refinance your car loan. If any of the following apply to you, it might be a good idea to hold off on refinancing.Your credit score has decreasedIf your score has decreased since your original loan, you may not qualify for a better car loan APR. Credit scores can decrease for a number of reasons, such as:Late or missed payments.High credit balances.One of your credit limits decreased.A lot of new credit inquiries.Your credit utilization score has dropped.You need a high credit score for another reasonRefinancing will cause your credit score to take a slight dip in the short term. If you need your credit to be in good standing for another reason, say a mortgage application, it is best to wait to apply for refinancing. The fees outweigh the savingsMany car loan contracts have prepayment penalties. Read your contract closely to see if you will incur any penalties, and call your lender directly if you are still unsure. Be sure to do the math and determine if any penalties outweigh any potential refinancing savings.You owe more on your car than it is worthWhen you owe more on your car than it is worth, it is referred to as being “upside down” or “underwater” in your loan. If this is the case, you may not qualify for refinancing.And that’s how to use our loan refinance calculator to decide if vehicle refinance is right for you!If you’ve been thinking about refinancing your car loan, use our loan calculator to see exactly how much money you could be saving – or get your free, no commitment, hassle-free quote to get started right now. GET A QUOTE IN 60 SECONDS

It’s hard to save money when the price of everything is skyrocketing around us. From the price of food to the price of gas to the price of rent, things keep getting more expensive while we all make the same amount of money.And because of this, it has never been more important to save money where you can. So today we have four simple tips that you can use to help you start saving money and improve your credit score.Here are four simple tips that will transform the way you spend and save.#1. Make a BudgetBudgets are without a doubt the best way to gain control of your finances. It is all too easy to overestimate the amount of money you are bringing in every month and to underestimate the amount of money you are spending every month. Having an accurate budget can help you keep a finger on the pulse of your finances to ensure that you are never spending more than you are making. Creating a budget is simple. It requires some time upfront to determine your income and your expenses, but once you have the initial budget figured out the hard part is over. After that you simply need to be alert about staying within your budget. Here’s how to get started:Determine your income.Depending on your situation, this may be as easy as looking at take home pay (after taxes and deductions are taken out). But if you have a few different streams of income, this might be a bit more complicated. Do you have a side income? Rental properties? An inheritance? All of this counts as monthly income.Determine your fixed expenses.Fixed expenses are expenses where the amount due does not vary from month to month. Make a list of all of these types of expenses. Common fixed expenses include:Rent or MortgageCar PaymentCable BillInsurance PremiumTrash CollectionInternetPhone BillProperty TaxesChildcare ExpensesStudent Loan PaymentsStreaming Services (Netflix, Hulu, Amazon, Etc)Enter all of these expenses into a spreadsheet so that you can easily track them and change them as needed.Determine your variable expenses.Variable expenses are expenses where the amount due changes from month to month. When trying to include these types of expenses in your budget, you want to calculate a realistic average. Looking at past bills and receipts from the past six months to a year will help you determine an average for each expense. GroceriesElectric BillParking FeesDining OutEntertainment and AttractionsHome Maintenance and RepairsGoing through credit card statements is a great way to determine some of these costs. Getting a realistic average of these expenses is very important, as these are the categories where you might find it easiest to cut back on spending.Plan your budget.There are a lot of different models for budgeting, so you will need to determine what works best for you. And this can depend a lot on what your goals are for budgeting. Are you saving for a new car? Trying to pay off your mortgage? Want to loosen more money up to invest? These different goals may result in different approaches to your budget.A commonly recommended budget is the 50/30/20 model for personal budgets. For this budget, 50% of your income is allocated for needs, 30% is allocated for wants, and 20% is put into savings. Another commonly used model is the 70/20/10 model for personal budgets, where 70% of your income goes to monthly bills and everyday spending, 20% goes to savings, and 10% goes to debt repayment. Make sure that whatever plan you choose is accurate and easy to track. An inaccurate budget will not do you much good.Adjust your budget accordingly.See how your goals line up with your current budget. Are you making more than you are spending, or are you spending more than you are making? What places can you cut back on? Are there any expenses you can eliminate altogether? Can you unsubscribe from a streaming service? Can you cut back on dining out? Adjust your budget as needed to line up with your plan.Budgeting isn’t the most fun thing in the world, but managing your day-to-day spending can really help your financial wellbeing in the future.#2. Refinance Your Car LoanIf you have a car loan, there’s a good chance that you are overpaying. But that can be easily fixed by refinancing your car loan.Refinancing your car loan can help you in a few ways. If your credit score has increased or the market rates have decreased since your initial financing, you may be eligible for a lower car loan APR. This can reduce your monthly payments as well as the total amount you will pay. It can save you hundreds, even thousands of dollars over the course of the loan.Refinancing your car loan will also allow you to change the repayment period. When you lengthen the repayment period, you are paying off the loan over a longer time so your monthly payments will be much less. If you are looking to free up some money every month to help with your budget, refinancing your car loan is a great way to do so. Using a company that specializes in auto refinance can ensure that the process is quick and easy so you can start saving money today.#3. Keep Your Credit Utilization Ratio In MindYour credit score is really important to your financial well being. And one of the most important components of your credit score is your credit utilization ratio. This is the ratio of how much money you owe compared to how much money you have available to you. This ratio should be less than 30%.Let’s say you have three lines of credit open to you. You owe $1,000 on a card with a $5,000 limit, $500 on a card with a $1,000 limit, and $2,000 on a card with an $8,000 limit. Your total credit utilization ratio is the total of all your debt ($1,000 + $500 + $2,000) divided by all of the credit you have available to you ($5,000 + $1,000 + $8,000). Your overall ratio is $3,500 divided by $14,000, which is 25%.But it is not only your overall ratio that matters. Your credit score takes into account your individual credit utilization ratios as well. While your overall ratio is 25%, your credit utilization ratio on your first account is 20%, on your second account is 50%, and on your third account is 25%. Keeping your credit utilization ratio in mind is a good practice to get into. When paying off your debt, focus on paying off your high interest credit lines in order of credit utilization ratios. Paying off credits that have the highest ratios can help increase your credit score at a faster rate.But even with day to day shopping, you should keep your credit utilization score in mind. If your overall ratio is high, try curbing your spending while you pay down some debt. If you know that one account in particular has a high ratio, avoid making purchases on that like of credit. Let your credit utilization ratios guide your daily spending.#4. Use Cash Sometimes, Use Credit SometimesThere is a time to pay with cash, and there is a time to use credit. Deciding when to do what can help you maximize your savings.Financial experts recommend using a credit card as a financial tool. You should use it when you can pay it back in full so that you can avoid the high interest rates and take advantage of the rewards.Here’s when you should pay with credit:When you have good cash back rewards in the category of your purchase. If you get 5% cash back on grocery store purchases, take advantage of that.You want the added security of not carrying around cash.Here’s when you should pay with cash:When your credit utilization ratio is high and you need to reduce your debt, not increase it.When you have a strict budget for something, such as vacation. Using cash will make it impossible to overspend.When you haven’t been able to pay off your credit lines in full. If your new purchase will linger in your debts, you will end up paying interest and paying much more in the long run.When there are added fees for paying with a credit card.Being smart about when to use cash and when to use credit can help you avoid unnecessary fees and help you better manage your money.Those are our four simple money management tips that will help you save more and spend less.Try using a few of these tips and see what works for you. Refinancing your car is a great way to save money every month and it is super easy if you use Auto Approve. You can get a free quote in minutes and our refinance experts can help answer any questions you may have. So don’t wait, start saving money today!GET A QUOTE IN 60 SECONDS

There are a lot of good surprises in life. A stranger in front of you pays for your coffee; you get a free upgrade on your flight; your waiter doesn’t charge you for your last round of drinks. But there are also a lot of bad surprises that can pop up. Your favorite show gets canceled; your sink springs a leak; a skunk sprays your dog.But of all the bad surprises that can happen, having your truck break down unexpectedly may trump them all. The good news is that many of the most common truck problems can be prevented with routine maintenance. So today we are talking about three of the most common truck problems and how you can avoid a bad surprise.Here are three of the most common truck problems and how you can prevent them with proper truck maintenance.#1: Engine OverheatingThe engine is the heart of your truck. Truck engines are built to be durable, but they often cannot withstand extreme temperatures. Everything in your truck is designed to work within a certain temperature range. When that temperature is exceeded, parts like gaskets and hoses can melt and fall apart. All trucks have cooling systems which aim to prevent this, but if this system isn’t working properly it could spell disaster for your engine.What causes a truck to overheat?If your truck overheats, you want to pull over immediately and wait for a while until your engine cools down. Don’t pop the hood until it has had the chance to cool a bit–you could seriously hurt yourself. When it’s safe, you can take a look at the engine to figure out what’s gone wrong specifically. Here are a few common reasons.Not enough coolantCooling system leakBlocked hoses caused by mineral deposits or corrosionBroken water pumpNot enough oilProblems with the radiatorDefective hose or beltBlown head gasketAir trapped in the linesYou may be able to quickly determine what the problem is. Is there coolant spraying around everywhere? Is there a broken hose? If you cannot figure it out, it’s best to take it to a licensed mechanic to diagnose. Try to decide if the situation warrants a tow or not. If you decide to drive home, be smart about it. Turn the heat on, which will help get rid of some of the heat. It won’t cool your engine down fully but it may help. Be sure to open your windows as well to further cool things down.How can I prevent overheating?Proper maintenance can help you avoid overheating in the future. It’s important to check your fluid levels. Make sure your car always has oil and coolant and top off when necessary. Flushing your coolant regularly will also help ensure your cooling system runs properly.In addition to maintenance, try to avoid running your AC nonstop. This can put added stress on your engine. Keeping a bottle of antifreeze and a gallon of water in your truck is a good idea to help in a pinch if your truck does overheat.#2: Suspension IssuesModern pickup trucks are handling a lot more weight than they ever used to. And with that additional weight comes additional stress on the pickup's body and suspension system. A suspension system is all of the parts that support the pickup on the road. It works to maximize the amount of friction between the tires and the road, creating a smoother ride. A suspension system helps keep the ride comfortable from bumps and potholes while making sure the handling is also smooth as you navigate turns, acceleration, and braking.If a suspension system is not working correctly, it can lead to other issues.There is an increased chance of a rolloverYour truck will be difficult to control in an emergencyYou can cause damage to your vehicle (which can include bent drive shaft, bent control arms, sheared tie rods, transmission failure, or a dead differential)A suspension system has many parts to it. If your suspension isn’t working correctly it could be from any of the following issues.Shock absorbersShocks StrutsCoil springsBushingsBall jointStrut mount/ bearingsControl armsIf any of these parts are worn away, corroded, misaligned, or broken, your suspension can feel off and you are at a higher risk for further complications. It is recommended that you get your suspension parts replaced every 50,000 to 100,000 miles. If your truck is hitting that mileage number it’s a good idea to get your suspension system inspected and replace any parts before you have an issue.#3: Braking IssuesYour truck’s brakes are immeasurably important. Brakes are your number one line of defense when driving. Brake failure can occur for a number of reasons, but improper maintenance is at the top of the list.Issues with brakes can arise for a number of reasons, but the more stress you put on your brakes, the more frequently they will need to be serviced. The following can put extra stress on your brake system:Driving on hills with sharp turnsCity stop-and-goDriving in a mountainous or hilly areaUsing cheap brake pads and brake partsBrake maintenance is recommended every 20,000 to 60,000 miles depending on how aggressively you use your brakes. You may need brake service if you notice the following:You hear strange noisesYour truck starts pulling one wayYou feel a vibration or pulsing when you apply pressure on the brakesBrake maintenance can help ensure these problems don’t arise in the first place. Maintenance at the very least should include replacing your brake pads and changing your brake fluid. It is a good idea to have the brake system fully inspected to prevent additional problems. A certified mechanic can:Remove the caliper and fully clean and relubricate everythingReplace the rotor as neededReplace the caliper as neededKeeping your truck brakes well maintained can help prevent further issues and can even save your life. This is one area of truck maintenance where you definitely don’t want to drop the ball.Those are three of the most common problems that trucks can have and what you can do to keep your truck on the road.Maintenance is an important part of truck ownership, so creating and sticking to a maintenance schedule is very important. Maintaining your automotive budget is also an important task, and refinancing your truck loan is a great way to keep some extra money in your pocket. Refinancing to a lower APR can save you hundreds of dollars a year.Don’t wait–contact Auto Approve today to see how much money you can save!GET A QUOTE IN 60 SECONDS

You’ve probably thought about the things you would buy if money was no object. The house you would live in, the clothes you would wear, and–most importantly–the car you would drive.I mean, wouldn’t you drive the hottest Italian sports car if you had the extra cash to do so?Well, it may come as a surprise to you that the majority of self-made millionaires aren’t driving around in Lamborghinis and Ferraris. In fact, they are more likely to drive cars that are similar to what we drive.Here’s how self-made millionaires decide what cars to buy.Are millionaires frugal?While we often equate millionaires with lavish lifestyles, that is not always–and not often–the case. Sarah Stanley Fallaw, the director of research for the Affluent Market Institute, spent years analyzing millionaires to see what commonalities they had. In her book "The Next Millionaire Next Door: Enduring Strategies for Building Wealth," she surveyed more than 600 millionaires in America and determined that frugality was one of their chief characteristics.Examples of this can be found everywhere. Mark Zuckerburg can be seen frequently shopping at Costco. Warren Buffet has lived in the same house he purchased in the 1950s. We find it ironic that people who never truly have to worry about money, are in fact, concerned with saving money.Sarah Stanley Fallow wrote in her book, "Spending above your means, spending instead of saving for retirement, spending in anticipation of becoming wealthy, makes you a slave to the paycheck, even with a stellar level of income.” This philosophy is what helped many millionaires earn their wealth in the first place.Furthermore, only 2 in 10 millionaires are actually retired. The rest are busy working to continue building wealth for themselves and for their families. What cars do millionaires drive?Rather than driving high end luxury cars, wealth researcher Thomas Stanley found in his research that millionaires were more likely to drive affordable cars. He ranked the most popular brand choices as follows:ToyotaHondaFordBMWChevroletLexusNissanSubaruDodgeMercedesMillionaires were more likely to buy a Ford (#3) than buy a Mercedes (#10). And some popular luxury cars, like Audi, did not even make the list. It is interesting to see what cars millionaires choose to drive. Here’s a list of some of the most well-known millionaires (and billionaires!) and their chosen rides.Jeff Besos drives a Honda AccordMark Zuckerburg drives an Acura TSXWarren Buffet drives a Cadillac XTSLarry Page, co-founder of Google, drives a Toyota PriusSteve Ballmer, CEO of Microsoft, drives a Ford FusionSo why exactly do people with so much money choose to drive such sensible cars? Well, it turns out there’s a few reasons for this.Why do rich people drive average cars?They have a tendency to be frugalAs we mentioned above, Sarah Stanley Fallaw found in her research that millionaires tend to be frugal in their everyday purchases. This is part of the reason they have money–they don’t spend it irresponsibly.  In the incredibly popular Rich Dad, Poor Dad, Robert Kiyosaki writes, “Poor people purchase obligations (debt), while wealthy people purchase assets (intrinsic value and/or income producing).” That holds true with cars in particular. A car is an obligation, and many millionaires view them as such. Cars are not investments, even though they are technically assets. Millionaires tend to feel that they are an unnecessary cost, an easy line item to skip over. Their tendency to be frugal and live within–even below–their income level means that they will not risk losing the wealth that they worked so hard to amass in the first place.They understand depreciationDepreciation is the reason cars are not really considered valuable assets. Sure, in the short term you can sell your car and get some money back, but cars depreciate incredibly quickly. Cars lose about 10% of their value the moment they leave the lot. In their first year they lose about 20% of their value, and an additional 10-15% every year after that. By the end of five years, your car will lose about 60% of its original value. Cars depreciate for a number of reasons, including:AgeMileageMake and ModelOwnership HistoryCondition of CarMillionaires understand how detrimental depreciation can be, so they opt for investments that appreciate in value, like real estate. They don’t want to draw attention to themselvesMany wealthy people fear that if they draw attention to themselves and their wealth, they may attract some unwanted attention. They fear that they might become the target of fraud, theft, or frivolous lawsuits. By driving an average car, they won’t stick out as someone that has a lot of money.So what cars do they drive and what can we learn from their choices?Believe it or not there is a pattern to the type of cars that the wealthy choose to buy–millionaires tend to choose cars that are practical. Maybe they are looking for cars with good gas mileage, maybe they are looking for a truck with good towing capacity. They are going to select something that is practical for their lifestyle, not a car that is merely fast or attractive. Self made millionaires know that image isn’t everything, and buying a fancy car won’t do much for you in the long run.Even if you have the money in your bank account, it might not be worthwhile for you to shell out cash for an expensive car. Cars are necessary for a lot of reasons. After all, a significant number of us cannot rely on public transportation to get around. But cars are items that require a lot of upkeep, some of which can be very expensive.So why should you opt for the economic car over the fun, sporty one?We can avoid depreciationDepreciation will happen regardless of what car we buy. Buy after 5 years, a 60% depreciation on a $25,000 car is much less than a 60% depreciation on a $120,000 car. Take a chapter out of a millionaire’s book and skip the unnecessary depreciation loss. Additionally, we can work to lessen the effects of depreciation by taking good car of the cars we do have. Reduce your mileageKeep up on maintenanceKeep your exterior clean and ding freeKeep good recordsDon’t smoke in your carDon’t eat in your carBy taking good care of our cars we can reduce the effects of depreciation and increase the resale value.We can budgetBeing smart with our money doesn’t mean we can never have fun. It just means that we have to budget for it. Although it may seem counter-intuitive, millionaires don’t go around making impulsive purchases. Instead, they keep their budgets in mind and make practical purchases. If you don’t have a monthly budget, think about starting one. By consistently tracking your income and your expenses, you can be sure that you have money when you need it (remember to set up your emergency fund if you don’t already have one!)Budgeting for the car that you want is important for your finances. Try to use the 20/4/10 rule when purchasing a car. Put down 20% as a down payment on a four year loan and make sure that you pay no more than 10% of your monthly income on travel expenses.We can refinanceSaving money is all about cutting costs when you can. And a big area you can probably cut costs is on your car payment. If you are overpaying on your car loan (and you probably are), the extra money that you are paying is going towards interest. And that is going right into the pockets of the big banks. Refinancing can lower your car loan APR and save you a lot of money in the long run. Refinancing to a shorter repayment payment can also help you save money in the long run. By shortening the amount of time you are paying back the loan, you are decreasing the amount of interest you will have to pay. You will ultimately pay more per month, but over the life of the loan you will save hundreds of dollars.And that’s how self made millionaires decide what vehicles to buy–and what we can learn from them.Self made millionaires tend to be measured and thoughtful when deciding what type of new car to buy. An economical and practical car far outweighs a fancy luxury car in their eyes.No matter what our income is, we can learn from that philosophy. Being smart and living within our means will ensure that we can keep the money we have worked so hard to earn.While you may have your eyes on the new, shiny, expensive car that just came out, it is probably not responsible to give into your urge. Instead, opt for an economical and reliable car that will put you into debt.If you are looking for a way to save some extra money every month, consider refinancing your car loan with Auto Approve. A vehicle refinance at a great rate can save you tons of extra money and the process is super simple. So don’t wait, get your free quote today!GET A QUOTE IN 60 SECONDS

If you are financing your SUV, you have probably considered refinancing your SUV loan. But maybe the timing wasn’t right, or you just didn’t think it was worth the hassle. Well today we are talking about why right now is a great time to refinance.Here are our top three reasons to refinance your SUV.Reason #1. Refinancing can save you money– a lot of money.Saving money is the ultimate goal of refinancing. By finding a lower car loan APR, you can drastically reduce the interest that you will have to pay over the life of the loan. Car loans are front loaded amortized loans. This means that in the beginning of your repayment you are primarily paying back the interest, and as time goes on you gradually pay more towards the principal and less towards the interest. So the earlier you refinance your SUV loan, the sooner you can start saving money.There are two main reasons that you may be able to find a lower car loan APR: a change in market rates or an improvement in your credit score.Market RatesThe interest rate that you are offered will depend in part on the prevailing market rates. If the market rates are lower now than they were when you originally financed you SUV, you will most likely be able to secure a lower car loan APR. While rates are on the rise, they are still very low, making now the perfect time to consider refinancing your SUV loan.Credit ScoreIf your credit score has increased since your initial financing, you will most likely be able to secure a lower car loan APR if you refinance. Your credit score is the most important factor lenders look at when deciding what interest rate is appropriate. Your credit score is dependent on a few factors:Payment history (35%)Amounts owed (30%)Length of credit history (15%)Credit mix (10%)New credit (10%)Your payment history and amounts owed make up the largest portion of your credit score. Making full, consistent, on-time payments and reducing the amount of overall debt you owe will make the biggest difference on your credit score. If you have been paying down your debts and consistently paying your bills, there is a good chance that your credit score has increased and you can secure a lower car loan APR.Reason #2. Refinancing can help you with your monthly budget.By refinancing your SUV, you can loosen up your monthly budget significantly. Your monthly car payment can be reduced by either lowering your car loan APR or lengthening your repayment period (or both).Reducing your car loan APR will automatically reduce the amount of your monthly car payment. Let’s say you buy a $25,000 car with a $5,000 down payment. You finance the remaining $20,000 with a 7% loan over 48 months. Your monthly payments will be around $480. But let’s say you now refinance your loan to a 3.5% APR. Now your monthly payments are down to around $445. That little extra might make all the difference in your monthly budget. Over the course of four years, that’s a savings of over $1,000.Lengthening your repayment period will also change your monthly payments significantly. Let’s look at that same $20,000 loan at 7% over 48 months. Changing your repayment period to 60 months will change your monthly payments from around $480 to around $400. That is a huge monthly savings (although keep in mind that you will be paying more interest over the life of the loan due to the extended repayment).If a little extra breathing room would help you with your monthly budget, refinancing your SUV is a great way to save some extra money.Reason #3. Refinancing can get you out of a bad deal.It’s all too common for people to get roped into bad financing deals. A lot of the time it’s due to a smooth talking salesman and a moment of weakness. If you were a little underprepared when you went to look at a new SUV, you may have been blindsided and agreed to something that was less than ideal. There are a few reasons that you may view your loan as unfavorable:The APR is too highCar dealerships have notoriously high APRs. This is because they merely act as middlemen in your loan transaction with the lender. They simply markup the rates and fees that the lender offers. You should always avoid financing through dealerships–it’s much better to get a loan through Auto Approve. Unlike dealerships, Auto Approve never marks up their prices–ever. They compare different lenders and offers and pass the savings right on to you. The lender has bad customer serviceBad customer service can be a serious issue when it comes to financing. Not only is it downright frustrating to not be able to communicate when you need it, but it can cost you money. According to Consumer Financial Protection Bureau, these are the major complaints with lenders:Communication issues about forbearance (a temporary pause in payments)Repayment options regarding forbearanceDelays from lender with regard to loan modificationOvercollection of funds for taxes and insuranceConfusion with account noticesPutting overpayments into an unallocated fund rather than applying them to the loan’s principalThese issues with lenders can add up and cost you money in the long run. So if you are in a bad relationship, you want to get out of it immediately. Refinancing your loan is a great way to do that.The repayment period is too longWhile a longer repayment period will reduce your monthly loan payments, it will cost you more in the long run. If you are able to refinance your loan for a shorter period, you can save a lot of money.You had to use a cosignerIf your credit was not great, you may have needed a cosigner to get approved for your current loan. The only way to remove a cosigner is to refinance your loan. So if you are looking to take sole ownership of your loan, refinancing is the way to go.And those are the top three reasons you would refinance your SUV.There are a lot of great reasons to refinance your SUV. From saving money to saving yourself from frustration, refinance can make your financial life much easier. If refinance sounds like a good option for you, contact Auto Approve today. Our experts can answer any questions and help you start saving money now. Don’t wait to start saving – get your free quote!GET A QUOTE IN 60 SECONDS

We see the commercials all the time–shiny, new cars driving in the desert or on the mountaintops, with the words “starting at $30,000” plastered across the bottom of the screen. But just how accurate is the starting price that is listed? What is the real cost of buying a car?Let’s talk about the real cost of buying–and owning–a new car.What is the real cost of buying a car?It’s easy to think that the sticker price on the car is what you will pay when you decide to buy a new car. But it’s not quite that simple. In addition to the price of the car, you will have to pay additional fees, add-ons, and sales tax.Additional FeesWhen you buy a new car, there are a number of fees that you may be required to pay on top of the price of the car. First up is the documentation fee. This is the fee the dealership charges for their paperwork and processing. Some states have limits to how high this fee can be, while others leave it up to the dealership. Documentation fees can run anywhere from a few hundred dollars to a few thousand dollars.The vehicle registration fee is another added cost when buying a car. This covers the cost of registration, title assignment, and license plates. While this fee is charged by the state (and the amount will vary from state to state), dealerships can process everything in-house to save you a trip to the DMV. The vehicle registration fee will vary from state to state and be based on a number of factors, including the weight of the vehicle, the price of the vehicle, the age of the vehicle, and the horsepower of the vehicle.Depending on the dealership, they may have additional fees that you are required to pay. Advertising fees, shipping fees, and dealer prep fees may also be found lurking in your contract. You can try to negotiate these the best you can, but they can add on a significant chunk to the cost of buying a car.Add-OnsThere are a number of add-ons that you may select that will cause your sticker price rise. From entertainment systems to security features, there are a lot of ways the cost of your car can increase drastically. Common add-on features include:Window tintingKey protectionPaint and fabric protectionAll season floor matsBlind side protectionWheel locksRear seat entertainment systemLeather seatsThese additional features can add hundreds, even thousands, to your car’s total cost. If you have your heart set on any of these features, do some research beforehand to see how much you will be shelling out (and make sure it’s worth it to you).Sales TaxIt’s easy to forget about the sales tax when it comes to purchasing a large item. But sales tax on a $30,000 car is a significant additional cost. If you were to buy a $30,000 car in Pennsylvania where the sales tax is 6%, it would be an extra $1800.What is the real cost of owning a car?Once you have the keys in your hand and your foot on the pedal, that’s it, right? Unfortunately, no. The costs of car ownership continue throughout your car’s life.Maintenance and Repair CostsNo matter how great your new car is, it will require routine maintenance and a few repairs here and there. If your car is under a warranty, some of these costs may be covered for the first few years (typically 36,000 miles or three years, whichever comes first). But beyond that you should expect to pay for the following routine maintenance:Oil changesTire rotation/replacementAlignmentsAir filter changesChange radiator coolantChange brake fluid and power steering fluidWiper blade replacementBrake pad replacementAnd much moreAll of these maintenance costs can add up pretty quickly and may or may not be covered by your warranty. And there are always unexpected repair costs that will pop up here and there. Be sure to have an emergency fund so that you aren’t left in a tight spot.Insurance and InspectionThroughout the life of your car you will be required to get it inspected routinely and keep it insured. The cost of inspection varies greatly from state to state and may be of no cost to you. The cost of insurance depends on a few factors:State RequirementsAgeCar Make and ModelHigh-Risk ViolationsYearly MileageCredit HistoryDriving RecordZip CodeMarital StatusGenderIt will also depend on how much coverage you want to have. If your car is financed or leased, there may be insurance requirements for you to follow.Financing CostsIn addition to the actual cost of the car, you will also have to consider the cost of financing (unless you are buying with cash). The two main additional costs are the cost of interest and the origination fees.The interest you pay on your car loan can add up to a lot of money over time. If you purchased a car for $35,000 with no down payment and a 6% APR over 36 months, you would pay an extra $3,332 in interest over the life of the loan. This is why car loan refinance is so important. Whether you got a bad deal in the first place, or your credit score has improved since your initial financing, car loan refinance can save you a lot of money.In addition to the cost of interest, you will have to pay origination fees when you finance your car. Origination fees are basically the commission on a loan (they can also be referred to as acquisition fees). Origination fees are usually calculated as a percentage of the original loan, between 1% and 2% of the principal amount. On a $35,000 car with a 2% origination fee, it would be an extra $700 tacked onto your financing. How can I reduce the total cost of a car?You should aim to spend less than 15-20% of your take home pay on car costs (this includes all of your gas and maintenance too). Keeping to this rule will help you avoid overspending and overextending your budget. If you are looking to cut your car costs, there are a few steps that you can take to do so. Resist the add onsAdding a fancy sound system or all weather mats onto your new car may seem like a good idea at the time, but it can quickly add up. Resisting the pricey add ons will save you money on the total cost (plus if you are financing, it will save you on the interest of those costs).Refinance your car loanRefinancing your car loan can save you a lot of money in interest over the life of your car. Car loan refinance can save you money in a few ways.If you refinance your car loan to a lower car loan APR, you will save money on interest in total. While that $35,000 car would cost you over $3300 at a 6% APR over 36 months, that same loan would cost you 2,200 over 36 months if it had a 4% car loan APR. Refinancing your car to a shorter repayment period will also save you money in the long run. Reducing your repayment period from 48 months to 36 months will save you 12 months of interest, which can add up to a lot of savings. In addition, lenders usually offer lower rates to people who have shorter repayment periods. If your credit score has improved since your initial financing or if market rates have decreased, it’s probably a good idea to look into car loan refinance.Change insurance companiesLowering your car insurance payments is another way you can greatly reduce your monthly car costs. Different insurance companies base their premiums off of different factors, so it’s important to look around and compare all of the companies and rates. Lowering your insurance rates can add up to a lot in savings.Maintain your carThe more diligent you are about routine maintenance, the less likely you are to have a costly repair down the road. Keeping to a maintenance routine will help your car stay healthy for longer and keep the repair bills at a minimum.And that’s everything you need to know about the cost of buying–and owning–a car.Buying a car is expensive, and so is owning a car. But knowing what you are getting into can help you prepare mentally and financially for the expense. Remember that you can always try to negotiate some of the upfront costs and rates. If you already have a car that is financed, refinancing your car loan can help save you a lot of money in the long run. Contact Auto Approve today to talk to one of our experts and get the ball rolling. The sooner you refinance, the sooner you can start saving. So don’t wait–get your free quote today!GET A QUOTE IN 60 SECONDS

If you have ever applied for a loan, you have likely come across the term debt-to-income ratio. It is a very important factor in your personal finances and one of the key things that a lender will look at when determining whether or not to approve your loan.Let’s talk about debt-to-income ratio and why it’s so important.Why is debt-to-income ratio so important?Your debt-to-income ratio is calculated by adding up all of your monthly debt payments and dividing them by your monthly gross income. The higher the ratio is (which means the more money you owe) the riskier the loan is perceived to be. The more debt you have, the more likely you are to be unable to make your monthly payments.There are two components of your debt-to-income ratio that lenders will consider, your front end ratio and your back end ratio.Your front end ratio, also called the housing ratio, looks at your income compared to your housing expenses. These expenses include your monthly mortgage payment, property taxes, homeowners insurance and any homeowners association fees you may be required to pay.Your back end ratio looks at your income compared to all of your monthly expenses, including your mortgage and other housing expenses. It also includes your student loans, credit cards, car loans, and any other expenses you may have.Your DTI ultimately shows lenders how you handle your debt and how capable you are to pay back your debts. The higher your DTI is, the less likely a lender will approve you for a loan.How is my debt-to-income ratio calculated?To calculate your debt-to-income ratio, you first need to add up all of your monthly expenses. Some examples include:Mortgage paymentsInsurance paymentsCredit card minimumsCar paymentsStudent loan paymentsPersonal loan paymentsOnce you have your total expenses calculated, divide that number by your monthly gross income–your income before taxes and other deductions. That number is your DTI.Let’s say your monthly expenses are as follows:Mortgage payment: $3000Credit card minimums: $150Car payments: $400Student loan payments: $600Personal loan payments: $300Your total monthly debt adds up to be $4,450. If your monthly income is $13,000, then your DTI is 34%.Note that it includes your minimum credit card payments, but not your credit card balance or any other variable expenses, like groceries. In other words, this ratio gives lenders a good idea of what your basic monthly expenses are, but it's not necessarily a good indication of what you can afford. Qualifying for a $40,000 car loan does not mean that you can necessarily afford the payments.What is considered a good debt-to-income ratio?While these ratios will vary from lender to lender, there is a general consensus on what constitutes a good DTI. You should aim to have a front end debt-to-income ratio that is below 28%–this means that all of your housing expenses take up less than 28% of your monthly income. You should aim to have a back end debt-to-income ratio of less than 36%–this means that all of your expenses, including housing, take up less than 36% of your monthly income.All lenders have different requirements, and your DTI is certainly not the only factor they are looking at. If you have an excellent credit score but a slightly higher DTI, a lender might not view you as a risky candidate. If you have a higher DTI, you might not qualify for as low of an APR. Some conventional loans, like Fannie Mae, accept loan applicants with ratios as high as 50%. It really does depend on a lot of factors, but the lower your DTI ratio is, the more likely you will get a favorable loan.How can I reduce my debt-to-income ratio?If your debt-to-income ratio is higher than you would like, there are a few things you can do to lower your ratio.Create a BudgetTake the time to map out a realistic and easy to track budget. Take a detailed inventory of all of your expenses, from the boxed meal prep kit you got talked into to the electricity bill that keeps ticking higher and higher. Only when you look at all of your expenses listed out will you see how much you are truly spending. Compare your expenses to your income to see how it is measuring up. Are your expenses outpacing your income, or are you able to save a bit each month? If you have extra money every month, you should prioritize starting an emergency fund (if you don’t already have that). After that, look to allocate extra money to your debts. Look for ways to cut down on your spending–any money you save can be used to paying down your debts.Creating a budget can be difficult, so it’s important to attach goals to your budget to help keep yourself motivated. It can also be helpful to tell a friend or loved one about your budget so that you will have someone else to hold you accountable.Strategize Paying Off Your DebtThere are a lot of different ways that you can go about paying off your debt. Here are a few different strategies you can use to pay down your debt:The Snowball Method. Pay down your smallest credit balance first while only making minimum payments on the others. Once you pay off the smallest one, go to the next smallest and pay that one down while making only minimum payments on the others. Repeat until you have paid off all of your debt.The Avalanche Method. Focus on the accounts with the highest interest rates first. If you have three loans with respective interest rates of 18%, 13%, and 8%, prioritize paying down the first loan while making minimums on the others. When that one is paid off, move on to the second loan, and so on, until all of your debt is gone..Debt Consolidation. Another option is to use a debt consolidation service to move all of your debt to one account, and make payments on that. This will depend on what types of loans you have and what interest rates you can secure.There are some other simpler methods for paying off debt as well. These include:Paying an additional amount above the minimum on every balance every month.Making an extra payment every few months.Get a balance transfer credit card.Refinance Your LoansOne great way to help reduce your DTI is to refinance your loans. Refinancing your car loan or mortgage can help you in a few ways. When you refinance, you will be able to change your repayment period on the loan. For instance, instead of a 48 month car loan you can refinance to a 36 month car loan. This means you will be paying your debt off at a faster rate, reducing your DTI at a faster rate. Shortening your repayment period often comes with lower car loan APRs as well. Your monthly payments will be a bit higher, but if you can afford that adjustment it will greatly help your DTI and credit score in the long run.If your credit score has improved since you initially financed your car or your home, or if the market rates have decreased since you initially financed, you may qualify for a significantly lower APR. This can save you a lot of money, money that you can use to pay off other debts.Avoid Taking on New DebtThis may be obvious, but try your best to avoid getting into more debt. Limit your purchases, resist opening new lines of credit, and avoid any major purchases. Look to Increase Your IncomeIf you feel like you are in the weeds when it comes to your debt, look to increase your income. Perhaps you can pick up a side job or increase the hours where you currently work. Whatever your situation is, finding a way for your income to outpace your expenses is key.That’s everything you need to know about your debt-to-income-ratio and why it’s so important.Applying for a new loan can be stressful, so it’s important to be as prepared as possible. One way to prepare for your application is to calculate your DTI to see how you stack up. If your DTI is above 36%, you may have a more difficult time finding a lender. If you are able to delay the process, devote your time and energy to reducing your DTI ratio. This will most likely cause your credit score to increase as well. This will make you a much more desirable loan candidate as you move forward.Refinancing your car loan is a great way to help lower your DTI and increase your credit score. If car refinance sounds like a good option for you, Auto Approve may be able to help you. They have relationships with lenders across the country, which helps them secure the most competitive rates on the market. Simply contact us to see how much money you could be saving!GET A QUOTE IN 60 SECONDS

Buying a car can feel like a minefield when it comes to unexpected fees. Even if you have been able to successfully negotiate a good deal on the actual price of the car, that’s not even close to the car’s true price. So today we are going to talk about what a car actually costs and how you can prepare for the extra costs that you might not have been thinking about.Here’s what you should actually expect to pay when you buy a car.What are the common fees that you will have to pay when buying a car?No matter what state you live in or how much you spend on your new car, you will inevitably be required to pay certain fees. The vehicle registration, documentation fee, and sales tax are three additional costs you should expect to pay when buying a new car.Vehicle Registration FeeThis is the fee that the state charges to register a new vehicle. This covers registration, title assignment, and the cost of license plates. While this is a government fee, the dealer can provide this onsite so that you do not need to go to your local DMV. How the registration fee is calculated depends on the state you live in. Some registration fees are a simple flat rate, but sometimes they vary. States may base their fees on the following:The weight of the vehicleThe price of the vehicleThe age of the vehicleThe horsepower of the vehicleAdditionally some states charge extra if your car is electric. This is mainly to offset the fact that you will not be paying the gas tax.Documentation FeeThe documentation fee covers all of the paperwork that the dealership must do to complete your sale. This fee will vary greatly from dealership to dealership. Some states have limits to how much a dealership can charge for a “doc fee”–for example Minnesota has a $100 doc fee limit–but most states do not, so this cost can be very high. There is no doc fee limit in Florida, so the median doc fee is nearly $900. While you cannot negotiate a doc fee, you can keep it in mind when negotiating the price of the car. Be sure to negotiate more aggressively to offset additional costs. And keep in mind that sales tax is charged on the doc fee as well.Sales TaxWhile this is not a fee per se, it might be an unexpected cost for some. You will have to pay sales tax on the total price of the car plus the documentation fee. This will vary from state to state, but can add a lot onto the total cost of the car. If you buy a car for $35,000 in a state with 8% sales tax, that’s an extra $2800. In some states you may get a tax break if you are trading in your old car. If you trade in your car for $15,000 and your new car is $20,000, you would only have to pay tax on the difference of $20,000. This will depend on where you live.What other costs will you have to pay when buying a car?In addition to the fees above, there may be a few other fees that pop up in your car buying journey.Market AdjustmentSome dealers might mark up prices on their inventory because of supply and demand. Since we are in the middle of a vehicle shortage, dealers might put an addendum sticker on the price of each car. They are essentially saying that a particular car is in high demand, so they are raising the price to increase profits. You are not required to pay this fee and can try to negotiate, but the dealer also doesn’t have to sell you the vehicle for the sticker price. Advertising FeeSome dealers will charge what they call an advertising fee. They claim this covers the cost to advertise the sale of that particular car. Try to negotiate this fee down–there is a lot of room for negotiation with these types of discretionary fees.Other Dealer FeesYour dealer may charge other fees in addition to the standard fees. Fees for shipping or dealer prep can be found in many contracts. Always ask the salesperson if you are unsure what certain fees are for, and try to negotiate them down if you can.Addons and UpgradesIf you are buying a new car, you will have a lot of options for upgrading. From a nicer trim level to added safety features, there are a lot of added features that can run up your car bill:Anti theft devicesWindow tintingKey protectionPaint and fabric protectionAll season floor matsChrome plated wheelsBlind side protectionCargo traysSplash guardsWheel locksRear seat entertainment systemNitrogen filled tiresLeather seatsInterior ambient lightingAnd much moreThere are seemingly endless options when it comes to what you can add on to your car. But some of these can come with a serious pricetag. A rear seat entertainment system can easily run you an extra $2000, while window tinting can add an extra $400 to your car’s bill.It’s a good idea to consider which ones you want and which ones you can live without. Also think about what add-ons you can do yourself. A dealership will charge you $300 for fabric protection, but you can scotchgard your own fabric for less than $10.How can you save money when buying a car?With all of the added costs of buying a car, it’s important to try to save money where you can. Here are some of our top tips for saving money when buying your car.Know How Much You Can Afford Before You Start LookingGo through your budget and determine exactly how much you can afford to spend on a new car. A good rule of thumb is to keep your car’s sticker price below 20% of your annual pre-tax income. So if your household annual income is $150,000, try to keep your new car’s sticker price under $30,000. Be Flexible With What You WantWith today’s vehicle shortage, it might be hard to get the exact car that you want. Patience and flexibility are key here. If you have your heart set on one type of car, you will need to be patient and know that it might take months of searching, and you still might not wind up with what you wanted. If you can be flexible on the make and model, you will have a much more successful search.Scour The Internet For DealsOne of the best things about today’s technology is that you can find deals all across the country. The car of your dreams might be on the other side of the country, but it can still be yours. Sometimes a deal will be so good that even with shipping costs, you make out ahead of the game. Here are just a few sites where you can find the best deals:AutotraderCars.comCarvanaEnterpriseCarsDirectTrueCarVroomCars.comBe sure to check your local dealers and local papers as well. You never know where you will find the best deals.Negotiate As Much As You CanIt’s hard to negotiate a lot when there is a vehicle shortage. But that doesn’t mean you shouldn’t try. After all, a customer who is ready to pull the trigger is better than a hypothetical customer down the road. Try to negotiate on the cost of the car, the doc fees, advertising fees, marketing fees, and any other additional fees they might list in the contract. And if they are unwilling to negotiate, you can decide if the total cost is worth it. You can always walk away if you decide the answer is no.And that’s what you should expect to pay when you buy a car.Buying a car can be very expensive. From the unavoidable costs (like sales tax) to the optional costs (like tinted windows), the price can easily keep ticking up. But it’s important to remember that you are the customer, and as the customer you ultimately have the choice to buy or walk away. If you choose to buy a car, make sure you can afford to do so and that your budget will allow it.If you already bought your car but are still looking to save some money, consider refinancing your auto loan with Auto Approve. Refinancing can save you a lot of money in the long run–we’re talking hundreds if not thousands of dollars. If your credit score has increased or the market rates have decreased since your original financing, chances are you will qualify for a lower car loan APR.Get your free quote from Auto Approve today to find out just how much you can be saving!GET A QUOTE IN 60 SECONDS