You found the car of your dreams, but you
know your credit is not the greatest. You ask yourself, ?How
can I get an auto loan with bad credit?? You are not alone.
Thousands of people ask the same question everyday. Just because
you have bad credit, does not mean you can not buy that car
of your dreams. When considering bad credit auto loans, you
can save yourself thousands of dollars when you know about the
options available to you.
You have found the car of your dreams, but
you know your credit is not the greatest. You ask yourself,
?How can I get an auto loan with bad credit??You are not alone.
Thousands of people ask the same question everyday. Just because
you have bad credit, does not mean you can not buy that car
of your dreams. When considering bad credit auto loans, you
can save yourself thousands of dollars when you know about the
options available to you.
You can get all the resources you need to
compare auto loans with competitors trying to earn your business
online. Now you can shop online from the comfort of your home.
An auto loan online can save you the hassle of many long hours
waiting at a car dealership for an approval.
Finding an auto loan online is easy regardless
of you credit score. By simply completing a simple one page
application hundreds of online lenders who will compete for
your loan business. There are certain guidelines you should
follow which could help you save money on a car loan even with
poor credit. Careful planning, comparison shopping and persistence
are necessary to find the best deals.
Firstly you need know how much you can afford
to spend on monthly car payments. Use one of the many online
loan calculators to help you with this. Then it's just a matter
of shopping around to get the best interest rate. The internet
has made it easy to shop around and compare rates because you
can compare rates with hundreds of lenders from one site. You
can compare traditional lender such as banks, credit unions,
etc. The lower the interest rate the more you will have available
to spend on your car. You will also have to decide the term
of the loan.
If you have fair to good credit you should
have no problem getting approved. If you have bad credit you
can find lender who will work with people with poor credit.
The downside is the loan will cost you more as poor credit means
greater risk for the lender and therefore a higher interest
rate to you.
Most car dealerships are also happy to arrange
finance for you. First, you choose the vehicle you want, test
drive it and make the decision to buy it. The majority of car
dealerships are honest and will gladly help you find the best
rate of interest and save money on a car loan. However be sure
to check out the online lenders first the be sure you are getting
the best deal from your auto dealer.
Purchasing a new car can be a fun and exhilarating
time. However, for those with less than perfect credit purchasing
a new car can be stressful and exhausting as they try to locate
auto financing for their new vehicle. Many people experience
difficult times at one point or another in their lives, and
in many cases their credit rating suffers. When you have bad
credit, many lenders see you as a high risk and are reluctant
to lend you money to make your purchase. If you find a lender
that is willing to provide financing you should expect to pay
a higher interest rate than someone who has a better credit
rating. If you do have bad credit and are looking to make a
new car purchase there are several things you can do to make
obtaining an auto loan a little easier.
Before applying for any type of auto financing
you should obtain a copy of your credit report and credit score.
It is important to know what potential lenders will see before
you start looking for a loan. It is recommended that you obtain
a copy of your credit report at least once per year, before
making a major purchase or if you have been turned down for
credit. Obtaining a copy of your credit report will not lower
your credit score and will list all of your outstanding credit
card and loan debts, as well as any collections you have. You
can obtain a copy of your report by contacting the credit reporting
agencies directly
Equifax: (800) 685-1111, www.equifax.com
Experian (formerly TRW): (888) 397-3742, www.experian.com
TransUnion: (800) 888-4213, www.transunion.com
Carefully review your report to ensure that
everything is accurate and take immediate steps to correct any
inaccurate or wrong information. Each negative item on your
credit report goes to lower your credit score. Your credit score
will determine whether or not a lender will be able to lend
you money, and if so at what interest rate. Traditionally the
lower your credit score, the higher the interest rate you can
expect to pay.
If you are not planning to make your vehicle
purchase immediately, and your credit is less than perfect,
you may want to look into ways to improve your credit before
you apply for your auto loan. There are a number of excellent
online resources such as MyFICO.com www.myfico.com that will
not only sell you a copy of your credit report and score, but
also provide calculators that will help you determine the affect
of certain actions such as paying off $1000 on your credit card,
or how consolidating your debt will affect your credit,. If
you have any accounts that are in collections, paying those
off can quickly help you improve your credit score.
Lenders want to lend you money, but they also
want to know you are going to pay it back. Paying off a few
debts and paying all of your other bills on time puts out a
positive message to lenders, letting them know that your troubles
are behind you and you are making an effort to pay your debts.
Even increasing your credit score by a few points can open the
door to more loan possibilities, and lower interest rates.
If your vehicle purchase needs to happen immediately,
then speak to your bank or credit union to see what types of
credit scores they typically accept. When you apply for a loan
and are denied you can negatively impact your credit score,
and your ability to get other loans so it's important to only
apply for loans that you have a good potential for being approved
for.
There are several excellent websites and lenders
on the Internet that have loans designed particularly for individuals
with less than perfect credit. Most can be found by performing
a simple Internet search for the term ?auto loans?. In most
cases these sites allow you to complete your loan application
online, and send your application to several different lenders
who will compete against each other to offer you the best auto
loan rate. Websites like Auto Loans America.com www.autoloansamerica.com
may be a good solution because with one application you are
essentially applying for several loans, and because the lenders
are competing you are likely to get the best rate possible for
your current credit rating.
While in the end you may pay a higher interest
rate on your auto loan, getting auto financing for a new vehicle
isn?t impossible with less than perfect credit. Do some research
before you apply, and you?re bound to find the right lender
to make your vehicle dreams come true.
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