Lenders have started offering poor credit auto loans once again, because they find them to be more profitable. You can get an auto loan from your bank or another lender even if you have bad credit, but you may have to accept higher rates and fees.
Buying an expensive car with high financing costs may upset your monthly budget, so you must be sure that you can afford the monthly payments. Online research can help you to find out about what APR you need to be paying before you step into an auto showroom.
You can apply for an auto loan within minutes from your home or office. To get a free, no-obligation quote from a trustworthy lender who specializes in providing poor credit auto loans, please fill out our brief online form now.
Pick the right car
Car salesmen may try to talk you into buying a car you know you really can’t afford. If you feel you can’t afford the monthly payments, it’s best to look for a cheaper option. You need to consider your monthly expenses, existing debt payments, new car finance payments, car insurance, fuel costs, and repairs and maintenance. If you have bad credit, the lender may ask you to make a bigger down payment.
You can use an online loan calculator to decide about how much you can afford to borrow. If you feel that the monthly payments are unaffordable, you can extend the period of the loan or postpone your purchase until you’ve saved to make a larger down payment. You can also look for a more affordable model or consider buying a used car.
If you make a larger down payment, you will have to borrow less and will save on interest. You will also have more affordable monthly payments. Extending the period of the loan will result in higher interest payments.
Use this as an opportunity to rebuild your credit
Before you apply for poor credit auto loans, check your credit report to see if it’s accurate and up to date. If you find anything in your credit report that’s not correct, you can have it set right. If you find that your credit score is really low, you may need to focus on improving it before you take on more debt.
Timely payments will help to improve your credit score. If there’s any delay or default, you will be deeper in debt and may have monthly payments you just can’t afford. Getting a cosigner can help you to get a loan if you have bad credit, but bear in mind that your cosigner will take on full responsibility for the loan if you’re not able to keep up with the payments.
Compare quotes from a few reputable lenders before you sign up for an auto loan. Check the reputation of the lenders and read the fine print carefully before you sign up. To get a free, no-obligation quote from a reputable lender who specializes in providing poor credit car loans, please fill out our brief online form now.