How to Finance an Exotic Car

You want the car. You know you can afford it now, and that your credit is in good standing. But financing an exotic car might seem like a daunting task to tackle on your own, especially if you don’t have much experience with loans and lenders. Don’t worry – we’ve got all the information you need to make this process easier for you!

1. The Basics of Financing an Exotic Car

The first thing you need to know is that there are different types of loans for different cars. Sometimes, dealerships will offer in-house financing and sometimes they work with third-party lenders. Either way, the basics remain the same: when you apply for a loan through either method, your credit score will be pulled and your debt-to-income ratio will be calculated.

Your credit score is a three-digit number that ranges from 300 to 850, and it’s used to measure how likely you are to repay a loan. The higher your score, the better – because it means you’re less risky for the lender. Your debt-to-income ratio is simply the percentage of your monthly income that goes towards debts like student loans, car payments, and credit card bills.

Both of these factors will be important when you’re financing an exotic car, so it’s a good idea to get your credit score in order before you apply. You can get a free copy of your credit score by signing up for a service like Credit Sesame or Credit Karma, and you can get your debt-to-income ratio by reviewing the last few months of your credit card statements.

Once you have these numbers in hand, it’s time to start looking for financing – but before we dive into that step, let’s talk about some common terms you’re likely to come across when you start your search.

Loan terms can be confusing, but knowing the basics will help you narrow down your options and find the best loan for your needs. Here are some of our favorites: APR – Short for “annual percentage rate”, this is simply the interest on a car loan that is charged on a yearly basis. The lower the APR, the better – so be sure to compare loans before you sign anything.

Term – This is the number of years you have to repay your loan. The longer the term, the lower your monthly payments will be, but you’ll also pay more interest in the long run. So if you can afford to make larger payments, it’s better to choose a shorter term.

Down Payment – This is the initial cash that needs to be paid by the buyer when they take out their loan. A smaller down payment means higher monthly payments, so try not to skimp! On average, 20% of your car’s value is a good place to start, but it also depends on the type of car you’re buying and your personal financial situation.

Monthly Payments – These will be determined by your down payment and loan term, so they’re one of the most important factors if you want to keep costs low. Just like with any other loan, the higher your monthly payments, the more you’ll pay in interest.

Now that we’ve got these terms under our belts, let’s talk about how to find financing for an exotic car!

2. How to Improve Your Credit Score

Even if you have a high income and a good debt-to-income ratio, you might not be approved for the best loan terms if your credit score is low. That’s because your credit score is one of the most important factors lenders look at when approving a loan – so it’s important to make sure yours is as high as possible.

There are a few things you can do to improve your credit score:
● Make all of your payments on time, every time. Late payments will ding your score and make it harder for you to get a loan.
● Keep your credit card balances low. The more debt you have, the lower your score will be.

● Don’t open new credit cards unless you need them. Every time a lender pulls your credit score, it lowers your score a little bit.

3. What You Need to Know About Exotic Car Loans

Even if you have good credit and the money for a down payment, exotic car loans are usually more expensive than regular ones. So before you start your financing search, make sure that it makes financial sense to buy an exotic car – because once you sign on the dotted line, there’s no going back!

Exotic cars tend to be worth more than regular cars, so the interest rates on loans for them are usually higher. But don’t let that deter you – there are still plenty of lenders who offer great terms for exotic car loans.

You’ll also need to be prepared to put down a larger down payment since the lender is taking on more risk by financing a more expensive car.

Just like with any other loan, it’s important to read the fine print and make sure you understand all of the terms before you sign anything.

4. Finding the Right Dealer and Negotiating a Deal

Once you’ve found the perfect car and secured financing, it’s time to start negotiating with dealers.

Some of them might be willing to give you a good deal on the car itself, while others may be more interested in selling you expensive add-ons or extended warranties. No matter what they’re offering, always remember to compare prices before you make a purchase.

And don’t forget to work with your financing team to figure out exactly how much you can afford – then, have the dealer write up an official offer that says everything is “as-is.” This will protect you if something goes wrong after the sale and prevent any nasty surprises later on!

When it comes to dealers for exotic cars we recommend checking out Koenigsegg for the best possible deals and great customer service.

5. Final Thoughts on Financing an Exotic Car

When it comes to financing an exotic car, the most important thing is to do your research and make sure you understand all of the terms before you sign anything. Remember – this is a big-ticket item, so don’t be afraid to ask questions!

Doing these things will help improve your chances of getting approved for the best loan terms and help you get a great deal on your exotic. We hope you found this article helpful!

If you’re interested in learning more about exotic car loans, check out our finance department.

We offer lots of great information for anyone looking to finance an exotic car – no matter what their credit score is like or how much money they can put down!