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Even with the credit crunch, lenders will continue to make bad credit auto loans because the risk
is much lower compared to a mortgage loan. There are steps you can take to insure you get the
best deal possible.
FREE Credit Score & Report - get yours
You want to know exactly what you are dealing with before any lender pulls your credit. Any
mistakes, errors or outdated information should be disputed. You want your credit report to
reflect as much positive information as possible. Be prepared to explain any recent negative
information such as late payments or public records like bankruptcies.
Under the Fair and Accurate Credit Transactions Act (FACT Act) you can get your free credit
reports from all three major credit reporting agencies once every 12 months. You can order over
the telephone at (877) 322-8228 or online at www.annualcreditreport.com. You will have to
purchase your credit scores for a small fee.
Interest rate vs. Down payment
Like the age old question. Which came first, the chicken or the egg? Down-payment or interest
rate, which is more important. While the down-payment will demonstrate to a lender you are
financially able and willing to invest in your car purchase, the interest rate really determines the
amount of your monthly car note.
However, a good down-payment will keep you from being in an upside down loan due to instant
depreciation. A new car loses a significant amount of its value as soon as you drive it off the car
lot. An upside down loan is when the car owner owes more on the vehicle than it is worth. Putting
a down-payment on a car loan may also get you a lower interest rate.
Get your financing before you choose the car
You do not have to sit in shock at a dealership after your credit history is reviewed. Those days
are over. No longer are you at the mercy of dealer financing and risking possible embarrassment
if you are denied credit. The computer age has made it much simpler to research and obtain a
loan in the privacy and security of your own home before you even step foot into a car dealership.
New and used car loans are being processed 24 hours a day via online applications. Lenders
are competing for your loans, even if you have less than perfect credit. Online lenders can offer
better rates than dealerships because they do not have the expenses that come from running a
car dealership, less paperwork is involved and they do not have salesmen to pay.
Visit your local credit union
With bad credit you will undoubtedly have to pay higher interest rates, sometimes as much as 25
percent. Your local credit union may be able to offer you lower interest rates. Credit unions often
have less stringent credit standards. Many of them only pull one credit report, usually Experian,
when making credit decisions. Most other lenders will pull all three of your credit reports.
Those of you with a higher credit score at Experian may be able to benefit from running only one
credit report. Bad credit auto loans are increasingly popular among lenders because of the
enormously high interest rates they can charge. Don’t be taken advantage of just because you
have bad credit. You may qualify for an auto loan with the credit union.
Rebuild your credit before taking on a bad credit loan
Do you really need a car right now? Your need for a car may not be worth taking on a bad credit
auto loan. If you can wait awhile and work on rebuilding your credit scores you may save
thousands of dollars. A good credit auto loan may just be a few credit points away. Ridding your
credit reports of just one or two negative entries may drastically increase your scores. Start the
dispute process today and get the good credit auto loan you deserve.
Always do your homework when shopping for a bad credit loan as different lenders offer varying
rates. Do not feel pressured into taking the first offer. A lower rate may just be a click away.
is much lower compared to a mortgage loan. There are steps you can take to insure you get the
best deal possible.
FREE Credit Score & Report - get yours
You want to know exactly what you are dealing with before any lender pulls your credit. Any
mistakes, errors or outdated information should be disputed. You want your credit report to
reflect as much positive information as possible. Be prepared to explain any recent negative
information such as late payments or public records like bankruptcies.
Under the Fair and Accurate Credit Transactions Act (FACT Act) you can get your free credit
reports from all three major credit reporting agencies once every 12 months. You can order over
the telephone at (877) 322-8228 or online at www.annualcreditreport.com. You will have to
purchase your credit scores for a small fee.
Interest rate vs. Down payment
Like the age old question. Which came first, the chicken or the egg? Down-payment or interest
rate, which is more important. While the down-payment will demonstrate to a lender you are
financially able and willing to invest in your car purchase, the interest rate really determines the
amount of your monthly car note.
However, a good down-payment will keep you from being in an upside down loan due to instant
depreciation. A new car loses a significant amount of its value as soon as you drive it off the car
lot. An upside down loan is when the car owner owes more on the vehicle than it is worth. Putting
a down-payment on a car loan may also get you a lower interest rate.
Get your financing before you choose the car
You do not have to sit in shock at a dealership after your credit history is reviewed. Those days
are over. No longer are you at the mercy of dealer financing and risking possible embarrassment
if you are denied credit. The computer age has made it much simpler to research and obtain a
loan in the privacy and security of your own home before you even step foot into a car dealership.
New and used car loans are being processed 24 hours a day via online applications. Lenders
are competing for your loans, even if you have less than perfect credit. Online lenders can offer
better rates than dealerships because they do not have the expenses that come from running a
car dealership, less paperwork is involved and they do not have salesmen to pay.
Visit your local credit union
With bad credit you will undoubtedly have to pay higher interest rates, sometimes as much as 25
percent. Your local credit union may be able to offer you lower interest rates. Credit unions often
have less stringent credit standards. Many of them only pull one credit report, usually Experian,
when making credit decisions. Most other lenders will pull all three of your credit reports.
Those of you with a higher credit score at Experian may be able to benefit from running only one
credit report. Bad credit auto loans are increasingly popular among lenders because of the
enormously high interest rates they can charge. Don’t be taken advantage of just because you
have bad credit. You may qualify for an auto loan with the credit union.
Rebuild your credit before taking on a bad credit loan
Do you really need a car right now? Your need for a car may not be worth taking on a bad credit
auto loan. If you can wait awhile and work on rebuilding your credit scores you may save
thousands of dollars. A good credit auto loan may just be a few credit points away. Ridding your
credit reports of just one or two negative entries may drastically increase your scores. Start the
dispute process today and get the good credit auto loan you deserve.
Always do your homework when shopping for a bad credit loan as different lenders offer varying
rates. Do not feel pressured into taking the first offer. A lower rate may just be a click away.
Bad credit auto loans
www.rebuildcreditscores.com
www.rebuildcreditscores.com
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As the credit crunch and subprime mortgage
market defaults spread, bad credit auto loans
may become harder to get. The past several
years have witnessed a boom in consumers
obtaining auto loans with bad credit.
Because of these loose lending standards,
lenders are bracing themselves for a
widespread default in car loans.
Repossessions are rising at an alarming rate.
Consumers with bad credit may find it harder
to get a good rate on an auto loan. Bad credit
auto loans are still being made but a
downpayment may be required and the
interest rate will definitely be higher.
market defaults spread, bad credit auto loans
may become harder to get. The past several
years have witnessed a boom in consumers
obtaining auto loans with bad credit.
Because of these loose lending standards,
lenders are bracing themselves for a
widespread default in car loans.
Repossessions are rising at an alarming rate.
Consumers with bad credit may find it harder
to get a good rate on an auto loan. Bad credit
auto loans are still being made but a
downpayment may be required and the
interest rate will definitely be higher.
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