How To Get A Bad Credit Car Loan
You may feel as though there is even no chance of you getting a bad credit car loan or any type of loan for that matter. However, the fact is just the opposite. What’s more, many people, especially if you have less than perfect credit, may think that since they can’t get a car loan they might as well just get a debit card instead of a credit card. Although this may be an option for some, it will not be a true solution.
For one, having a debit card statement is just as convenient as a credit card statement. Therefore, you are going to be doing away with that piece of paper in your wallet or purse where you carry cash and the the card may not even look at the cardholder. Plus, they might overall do more damage than good when it comes to your credit. You do not want to find out later why you are not able to get more credit because you were unable to pay your bill.
Below are some of the most common things to keep in mind when trying to get a bad credit car loan. 개인회생
First of all, you’re probably staggering at the interest that you will have when you attempt to get one of these services. However, one of the most important things to remember if you find yourself in need of one of these services is that the interest is going to be incurred as soon as you are approved and not beforehand. In addition, you’re going to have to pay at least 5% of the total cost of the car. So the cost of the car plus the interest you will incur is what the lender is going to be looking at, not necessarily the interest rate. Therefore, if you have a bad credit or no credit, you will have to significantly raise the terms of the bad credit car loan to get the best rates down the stretch. This includes having to put down a bigger percentage of the cost of the vehicle. For instance, if you qualify for $18,000, then $18,000 is what the lender is going to ask for.
One of the ways to get around this problem is to use a high risk lender. These lenders tend to take interest rates and fees into consideration and usually work with you on a long term basis. These lenders are also going to offer you the same type of terms with regard to a bad credit car loan as you would get with a lending institution that specializes in this.
However, one of the downsides to using the high risk lenders is just the fact that you will not have as many lenders competing for your business as you would if you went with a traditional lender. Therefore, one of the ways you can make sure that you get the best deal is to take some time to search around. This process can be done either before you start your search or after you get some quotes. Since you do not know what you may not get, it would be wise to do the research before you go looking.
Of course, no matter how you go about it, you will very soon find out that you will probably need some kind of collateral to be used as a form of security in cases you may not be able to make the payments. If this is the case, you will find that the interest rates are going to be much higher than if you simply select a lender that requires no security.
In any case, you definitely cannot ignore the fact that having a bad credit score and no credit doesn’t mean you cannot get a car loan. Follow the following steps listed and you will be well on your way to having no bad credit at all.
First of all, get a copy of your credit report. That can be done via a free credit report that you can find online. Look over it to make sure that there are no errors and if there are, you should fix them immediately before you apply for the loan. Make sure you fix things like late payments and other items that could affect your score.
If there are no errors and you still do not qualify for a bad credit car loan, then you can consider going with a higher risk lender. This lender will require that you have at least a one year’s worth of past employment. Sometimes they will also require you have been employed at the same company for at least six months.
If you currently don’t own a car but you do have a good job that you are working for at the time you apply for the bad credit car loan, you could potentially be charged a higher interest rate. However, this will be determined on a case-by-case basis. Make sure you ask the lender their rate plan on an individual basis. For instance, if you only CarePay, they may have a lower rate of 10% but if you have experienced some derogatory items on your credit, they could be looking at 29%.