The people having bad credit should give up the desire to own a brand new car and opt for a bad credit used car loan. These days thousands of good-condition used cars are available in the market. Having been through a financial crunch, you need to have a balanced and realistic view of your financial situation. With poor credit rating, you should have dual objectives for financing a car. Your need of a car should be fulfilled and you should be able to payoff your loan installments on time as well. Paying off the installments on time will certainly improve your credit and make you eligible for low interest car loans along with...
Financing a new car is not advisable for the following reasons:
It would be extremely difficult for you to qualify for finance on a new car with bad credit. Even if you do manage to qualify, the rate of interest would be exorbitant and quite beyond your paying capacity.
The cost of a new car will be almost double the cost of a used car. Obviously, your loan amount will be larger and so shall be the monthly installments. With bigger monthly installments, there would be greater likelihood of failure in timely payments. Thus, you would always run the risk of spoiling your credit further.
On the contrary, if you choose bad credit used car loan, the loan amount will be much lower. Monthly installments shall also be within your paying capacity. Therefore, there would be little possibility of any sort of failure in timely repayment of loan.
A Few Suggestions:
To get best deals while looking for bad credit used car loan, you must keep the following guidelines in your mind: -
First of all you should have a good look at your credit score sheet to know your true standing. If your score is below 600, then you must keep yourself prepared for a relatively higher rate of interest.
Before applying for a bad credit used car loan, you should choose the model of the car that you intend to finance. This would give you an idea of the amount of loan you need to obtain. It is advisable to finance used cars, which are 2-4 years old. Such cars would be in reasonably good condition and shall have most of the latest features as well.
Make up your mind to place a high-value collateral. Going for secured bad credit used car loan enables you to get approved for low interest car loans.
Finally, it is always better to obtain easy online car loan. Applying for bad credit used car loan on Internet is extremely easy. You just need to fill out a simple application form and furnish details regarding your employment, income, intended loan amount etc. Numerous online finance companies specialize in this field. If you are a student, you can even find online companies that offer student car loan.
Bad credit used car loan is a boon for people with bad credit. However, bad credit car loans are not always low interest car loans. This is because bad credit car loans are high-risk loans and entail a higher risk for the lender, hence the higher rate of interest. You can get an easy online car loan by using an online auto loan calculator and taking online car loan quotes from different companies.