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How To Get An Auto Loan With Bad Credit?
You have found the car of your dreams, but you know your credit is not the greatest. You ask yourself, How can I get an auto loan with bad credit?
You are not alone. Thousands of people ask the same question everyday. Just because you have bad credit, does not mean you can not buy that car of your dreams. When considering bad credit auto loans, you can save yourself thousands of dollars when you know about the options available to you.
You can get all the resources you need to compare auto loans with competitors trying to earn your business online. Now you can shop online from the comfort of your home. An auto loan online can save you the hassle of many long hours waiting at a car dealership for an approval.
5 Ideas To Help Get A Bad Credit Auto Loan
1. The first step is to find out what your credit situation really looks like. With a credit score, also known as a (FICO score) with a 500 rating it may not be wise to get an auto loan. It may be wise to simply save money to pay cash or at least 33% of the cost of a new car. With some bad credit auto loans you may have up to 29% interest rates. You can end up paying two times the cost of a new car after interest and fees.
2. You can get a better deal if you take advantage of buying a new car at the end of the month. Sometimes the dealerships sales managers give big incentives to car dealership salesman. This gives them a big incentive to get you an auto loan even if you have bad credit.
3. Sometimes if you can find a good co-signer to help with a bad credit auto loan, this might be your ticket into that new car. The co-signer has to have great credit because they are responsible for making the loan payments if you dont.
4. Make sure you have at least $1,200 per month income from your job. No more than 20% of your income can be used for a monthly auto loan payment. This can be combined income if you are married.
5. Take a look at first time car buyer programs available online. There are some great programs on the Internet that can help you get into that car of your dreams.
With todays Internet and online access you can do a simple search on bad credit loans. You can get many resources and tools that can help you get an auto loan. You can buy a car with bad credit. You just need to do a little research first. If you do research and use the tools available online, you can save valuable time and money when you buy that new car of your dreams.
Quick Fix to Bad Credit Score
A bad credit score is one thing that financially independent individuals should avoid. This is detrimental in many aspects of their financial lives. For instance, a bad credit score can void them of good jobs. This may sound unbelievable but indeed it is true. Many employers seek out those potential employees who do not have uncontrollable debt. This is because a bad debt can rid a person of his concentration. At work, an unfocused employee can cost losses in profits. This person would not be able to perform well thus possibly dragging the company down with him.
Another bad result of an undesirable credit score is disapproval of loans. Loans are critical for building ones life. A person needs loans for buying his own house. He needs it for owning a car, putting up a business and more. But with a bad score, all of his goals may not come true in a smooth manner. He can get approved on such loans only when his score is above 700.
A bad credit score is brought on by unpaid bills or late payments. This is usually the case in a massive credit card debt. People apply credit cards promotions and get hooked on spending. Before they know it, they are in too much debt. A lot of people disregard their pending payments. They only get surprised when they apply for a loan and their credit reports are shown.
However, there is a quick fix they can do to change their fate on loans. Note that credit bureaus have a method of scoring. One way is by checking a persons recent payment history. It means that what matters in their scoring is the recent payment activity of a person. Therefore, an individual can up his credit score by making recent on time payments.
For his credit card bills, he can opt for credit card balance transfer. When all of his credit card debt is in one place, he can make efforts to pay on time. It wont be as hard this time because of only one bill and one interest rate. Utility bills also matter so he should always look out for the deadline. He should pay before the due date just to make sure. Also he can cut off some of his unnecessary spending. This way he would have extra money for the payments.
Doing this for at least six months can increase his chances on a good credit score. After which he can then take on some loans.