Buying a Car With the Best Bad Credit Auto Loans
Owning a car can improve your lifestyle. If you think your bad credit score will prevent you from buying a car, you’ll be happy to know you have more options for bad credit loans than you thought. You can start the process of searching for the best bad credit auto loans because they are available to you no matter what your credit history is. You could be approved within one working day and be on the road to a better life. Here’s how.
Research the Car
It will make the process a lot easier if you know which car you want. One option is to buy a year-end holdover as dealers offer better prices for older cars because they want to make space for newer models.
However, if you want to buy a new car, you can. There are a number of reasons why a lender will give you a loan to finance a new car even with a troubled credit history. This is because buying a new car means you can actually spend all your money on paying back the loan and not end up having to spend it on costly repairs, which can happen with a used car. Also, a new car has more value, so if you do default on the loan, the lender can reclaim the car, and it will still have a good resale value.
Whichever car you choose, take the time to understand the features and extras that come with it and decide what you need and what you don’t. You can reduce the cost of the car by not accepting all the extras.
Get Approved for Your Bad Credit Auto Loan
Early preparation is key to getting the best bad credit auto loans. Consider various lending agencies to learn about all the options available to you. Research the loans available from your bank, credit unions, finance companies, and car dealerships. Don’t be afraid to do comparison shopping as increased competition between lending agencies means you have more options, and you should know them all before you decide.
To improve your credit report, order a free copy of it at least three months before you plan to buy a car. Pay specific attention to any negative items because sometimes they are mistakes, and you can correct them. You also want to reduce credit card balances as much as you can. Recent activity that shows your paying bills on time will give you more credibility with the lender. Once you start approaching lenders, have proof of identity, residency, and income on hand.
Be a Decisive and a Slightly Tricky Shopper
Never take a car home before the deal is done even if the salesman says there is no obligation in doing so. Dealers want to use your emotions, and when they see that you’re unsure of yourself, they may take advantage of you and push you to accept terms and extras that you don’t need. These extras such as paint insurance and extended warranties will increase the cost of the car. As you look at cars, try to maintain a neutral stand while you discover all your options. After you have prices on paper, make a decision and move forward decisively. If you can’t make the decision right there in the shop, ask how much time you have to think about it and step out of the showroom to gather your thoughts and decide.
Wrap Up the Deal
Review the contract and read the fine print to ensure it’s final and that you’re not agreeing to a variable interest rate or hidden costs. Making the lowest monthly payment for the shortest amount of time is your aim.