Owning a car, for many people, is a necessity of life. It allows you to get and maintain jobs and can be a real asset in living a decent life. However, getting a car also means getting financing and for many in this economy, credit rating is a problem. Still, just because your credit is less than ideal, that does not mean you can’t buy a car. If you are diligent and prepared to make the effort, the dream of owning a vehicle is within your grasp. Let us show you how to get a car loan with bad credit.
Know Your Credit
The first step in getting a car loan is to know your credit. Everyone is entitled to a free credit report every year. This report can be obtained at annualcreditreport.com. It will cost a few dollars to get a copy of your FICO credit score, but the expense is worth it. Knowing the good, bad and ugly of your credit will help you to get in fighting shape.
When you have your report in hand, do what you can to remove black marks. Pay off old debts or look into options for having them cleared. The more you can do to clean up your credit, the better you will be.
Do Your Homework
Two different lenders will look at the same credit score in different ways. This is because each lender values different things. While one may see a poor credit score and take that as gospel, another might look at payment history and your efforts to improve your score. Do not take one refusal or offer of bad terms as the final word. Research and talk to different lenders.
Car Finance Lenders
Lenders that specialize in car loans can be a boon to those with low credit. These sources know how to view your credit and often can work with you even if your credit score is low. Where a bank may offer you terms at a very high rate, a car lender might be willing to cut you a better deal.
Get a Partner
Having a partner on board can be a major boon. Not only can they help you to review the contract and terms, if they have good credit they may be willing to co-sign. A co-signer with strong credit can significantly reduce the interest rate on your new loan. Be sure that your partner understands that by co-signing they are taking on some of the responsibility for the loan.
Loan Terms vs. Monthly Payments
Too many people look at their monthly payment as the sole indicator of their auto loan. The overall terms are just as important, if not more so. If you reduce your payment by $150 a month but are going to be paying off the car for ten years, that’s not ideal. Not only will you pay far more interest in the long run, you may still be paying on the car after the time for repairs begins. If you need a ten-year auto loan, chances are you are aiming too high.
If you are looking to refinance your current auto loan, we are here to help. Drop us a line today! 800-258-3759 We can help you get a car loan with bad credit.