Many people who shop for cars usually go directly to the dealer’s finance office after they decide on the car they want to buy. This procedure is ideal for those who have good or outstanding credit, but may not be the best solution for those with poor or bad credit.
Below are some tips for acquiring a car loan when you credit is considered fair or poor
Don’t rush into a deal. Take the necessary time to shop around and never take the first loan offered. Try your local bank or go to a few different banks. You may also want to try a credit union. Many credit unions offer competitive rates and some will work with you even if your credit is poor. Also you may want to do an Internet search. Google ‘car loans for people with bad credit’. You will be surprised how many offers there are from reputable car dealerships and banks.
Did You Check Your Credit Report Lately?
It is important to know what kind of credit score you have. Also, when you get your credit report, is is a good opportunity to check for any discrepancies that may be listed there.
Do not assume poor credit may restrict you. Car dealerships shop around too, on your behalf. After all, they do want to sell you that car. With that said, there are plenty of dealerships that are willing to offer favorable deals to those with poor credit scores. Did you know that car loans are easier to obtain because of the ease in which lenders can repossess the vehicle that falls in default.
If you do get that loan, make sure you keep it current. Car companies are quick to recover their property, even if you are only two months late. In addition, having a car loan that is paid on time helps you to build up your credit rating.
Learn the Finances
Do some research to see how car loans (or loans in general) are calculated. Then do some calculating to make sure that you will be able to comfortably make the monthly payments.
It is possible that you may obtain a car loans with interest rates that are fairly close to the prime rates. The key is not to be hasty. Take your time and this time will pay off in the long run.