Getting an Auto Loan in BC with Bad Credit
Bad credit are the two words consumers never want associated with their name because it can limit what and how they purchase things, such as an automobile. For most people, a car is an important part of daily life, so having the ability to buy one is not a luxury, it’s a necessity. Unfortunately, traditional auto lenders such as banks and credit unions want buyers with good credit, leaving those with bad credit in a bad situation. The solution for them is to find a lender willing to help them get an auto loan BC, regardless of their credit rating.
What is Bad Credit?
Everyone has a credit score based on their history of paying back money they owe. This number, typically between 300 and 900, is set by credit reporting bureaus and establishes each person’s credit worthiness. With a higher score a person is considered more credit worthy and more likely to pay their debt on time.
• Excellent credit: 750+
• Good credit: 700-749
• Fair credit: 650-699
• Poor credit: 600-649
• Bad credit: below 600
Credit reporting bureaus use several factors to determine credit worthiness.
• Payment history
• Number of credit accounts
• Types of credit accounts
• Available credit
• Length of credit history
Good vs. Bad Credit
A good credit score makes it easier to get a mortgage, credit card and auto loan and makes it easier to purchase other big ticket items. Bad credit is the opposite, making it more challenging to buy these things. While bad credit is the general phrase used for anyone who paid late or defaulted on loans, every person has a different credit background and different reasons for having bad credit.
• Cost of living
When the cost of living goes up but a person’s income does not, they may find it difficult to pay bills.
• Credit card debt
Credit cards are easy to use and hard to pay off. Some people get too many cards and don’t have the ability to pay the bills.
• Late payments
• Exceeding the credit limit
• Unpaid bills and loans
Getting behind in payments is bad, but it’s even worse when the bills and loans are never repaid. In addition to the original amount, late fees push the debt even higher.
Bad credit is not an impossible situation. Different lenders use different criteria to determine when a customer is a good loan candidate and when a customer is a risky option. Bad credit is only one part of the loan process and is not necessarily an automatic no. That means some lenders are willing to give an auto loan BC to people with bad credit.
Getting an auto loan BC is easy with the right lender. Qualifications include being a resident or citizen of Canada, being at least 18 years old, being employed and making enough money for loan payments.
Getting an Auto Loan
Bad credit comes with an implication that a person intentionally avoids paying their bills, but that is not always the case. Sometimes landing on the lower end of the credit rating scale could be the result of an unfortunate and uncontrollable situation, such as a medical emergency, or it could be the result of someone who got in a financial bind and is struggling to get free. Sometimes people make financial mistakes, but they should not have to pay for them forever.
Not every lender is willing to take a chance on someone with a less than reliable payment history, but lenders who do understand that people deserve second chances. They understand that a person’s credit score and past payment history don’t tell the entire story. For these lenders, bad credit is a statement, not a judgment. Getting an auto loan BC is a real possibility for people with bad credit. They just have to choose the right lender.