Most car buyers are drawn to the glitz and glamor of a brand new car, and are more than willing to shell out a considerable amount just to drive the latest car models. If you really want to make the most out of your money, used cars can actually be the better choice due to their inherent qualities.
Recent expert analyses found that used cars of today present little to no trouble among car buyers. Unlike those in 2007, used cars of today aren’t at risk of developing major engine and transmission problems early on. Furthermore, many used cars can easily reach 200,000 miles with proper maintenance.
Brand new cars tend to lose as much as 47 percent of their value within three years, and would continue depreciating by 24 percent in the next three. Used cars, on the other hand, don’t depreciate its value as fast as its brand new counterpart.
Certain used car models are equipped with commonplace safety features, such as antilock brakes, traction control, and side air bags. While these might seem like a far cry from today’s hi-tech features, these would certainly help in protecting you and your passengers in the event of an accident.
Used doesn’t necessarily mean substandard, and used cars are testament to that fact. Visit nearby used cars dealerships to learn more about the benefits of used cars.
Financing is one of man’s greatest inventions. Despite all the criticisms, it’s undeniable how much help lending extends to millions of Americans who lack the resources. Auto financing, for instance, has helped countless families purchase their much needed transport. Before taking out an auto loan, however, it pays to know how the financing process works.
Financing means lending money to support someone’s purchase. Financial institutions, banks, and private lenders are the ones that provide this service. Anyone who considers borrowing to support their financing can apply for a financing program from them. There are two available options for anyone considering financing—direct lending and dealership lending.
Direct lending involves taking out a loan directly from a bank or a credit union. While this may sound like a great idea, it can completely be troublesome, especially if you are applying for an auto loan for the first time. You might find the process too complex that you might end up accepting anything they put on your plate. Also, most creditors have limited time when entertaining clients.
Dealership financing, on the other hand, means you will get financing through the auto dealership where you are buying the vehicle from. You with enter a financing contract with the dealership and the dealership will sell that contract to a financial institution. It’s a good riddance of the complicated application process. Some dealerships even allow financing for buyers with bad credit. If you are planning to take out an auto loan soon but you have a really messed up credit history, don’t hesitate to go to car dealers for bad credit consumers.
It’s not a secret anymore that despite having less than stellar credit, people can still apply for loans to purchase vehicles. The problem lies in getting approved. Cars are major investments, after all, and not many lenders from prestigious banks are willing to finance a new car for someone with bad credit. There are, however, a few things that could help you get a loan for your new ride.
Get a Good Head Start
If you are intent on buying a new car, you must start preparing as early as possible. The first thing that should be on your to-do list is to build up your credit again. This means checking up on your credit, settling any debt you may have accrued, paying bills you may have missed, and maintaining an ideal credit score. During this period, it’s necessary not to make any big-ticket item purchases that could set you back.
Work with the Dealer
Banks aren’t your only choice when it comes to financing your new car. There are actually some car dealerships that specifically cater to people who are struggling with their credit. After an assessment of your finances, these dealers can offer you affordable options. To further sweeten the deal, you can bring proof that you are a good credit risk. Bring documents like your recent pay stub from your job, your paid utility bills, your driver’s license and some personal references. These will put you in a better position to negotiate.
Stick with the Budget
Your choice in cars will most definitely depend on how much you will be approved for. This might limit your options but you must stick with the budget if you want an easier time paying it off. That said, bad credit used car loans may allow you a little more flexibility when it comes to down payment and interest rates. A higher down payment is better because you get lower interest.
A lot of people are discouraged from buying a car because of their poor credit. They think it would be impossible to find financing, and if they do, the terms might break their monthly budget. Fortunately these days, a lot of financing institutions have started offering auto loans for bad credit. The process of taking out one isn’t that easy, though. Here are some of the things you should keep in mind.
Not All Lenders Think the Same
You may think that all lenders look at people’s credit rating in the same manner. The truth is they don’t. Some lenders will see your poor credit history in a more positive light than others, which is why you need to shop around and not focus on several prominent ones. If you are lucky, you will come across banks that cater specifically to subprime buyers.
Dealerships Instead of Lenders
If you can’t find a lender that specialize in providing auto loans for bad credit buyers, there sure is a car dealership that offers such solution. This is now becoming a popular option provided by select dealerships to help subprime buyers make a purchase despite their financial situation. These dealerships do not provide the financing but use their network to find you the financing option that is perfect for your needs.
When considering financing through a dealership, do not walk away from the premise without making sure that the terms are final, not contingent or conditional. This way there won’t be any hidden charges or increases after the deal is closed. You can avoid such issues by going to a reputable dealership that offers auto loans for bad credit buyers.
You’ve wanted a used truck for years, and the only thing standing in your way is the price. Even if you’re buying used, there are ways you can get a good deal and save money.
Get an Accurate Price
To avoid going over your budget, you need to know what the actual value of the used truck is. You can find the MSRP, or the suggested retail price, online. You’ll also want to know the invoice price, the price the dealer paid for the car. Obviously, they have to make a profit to stay in business, but they should be reasonable as well.
With this price information, you’ll have a set goal of how much you’re willing to pay. It’s important to be flexible, though, because this process involves a lot of give and take. Take your time and only sign the papers once you’re absolutely sure the price is within your means.
Narrow Down Your Search
There are many buyers out there who don’t really know what they want out of a truck. Then when they show up to used cars dealerships, they tend to overspend and make impulsive decisions.
Before stepping out to shop, make sure you know what you want in a used truck. Focus on must-have features and how much horsepower you want. You can then weigh your wants and needs and stay within budget.
Even though buying a used truck is a huge purchase and decision, it can go smoothly if you know what you want and how to save money.
When you have bad credit, chances of securing an auto loan may seem bleak. After all, why would lenders take the risk? The truth is there are many places you can secure bad credit auto loans. But avoiding financial regrets later on isn’t possible unless you ask yourself these questions.
How Much Can You Afford?
Just because you can secure a loan from car dealers for bad credit doesn’t mean you can go crazy and purchase an expensive vehicle. It needs to work based on how much money you make and how much you can actually afford. This involves calculating your monthly income and your expenses monthly expenses.
You’ll also need to account for costs besides the monthly payment, including insurance costs and down payment. If you still have money left over to live comfortably and within your means, your dream car may be attainable.
Do You Make a Large or Small Down Payment?
Other than the monthly payments, the next biggest cost of purchasing a vehicle is the down payment. If your credit is bad, then you should save as much money as you can for this cost. That way, you can pay off the car as quickly as possible so that interest don’t start adding up.
If you’re opting to buy a new vehicle, it’s recommended to put down at least 20% of the purchase price. This prevents you from owing more than your car is worth.
Bad credit is only a small bump in the road of purchasing a vehicle. The more you assess your financial situation, the better decisions you can make for you and your family.
For those with bad credit, the good news is you can still secure an auto loan. These loans are not just going to fall in your lap, however. You’ll need to research and avoid these common pitfalls.
Providing Inaccurate Information
Just because you can get loans with bad credit doesn’t mean you should take the application lightly. You still need to provide accurate information so you can get approved. Financing experts analyze the information you provide meticulously and they’ll be able to spot errors or false information almost immediately.
Take your time with the application, and make sure everything is filled out correctly. You’ll need to provide proof of income, vehicle information, proof of insurance, credit and banking history, and proof of residence.
Many people make the mistake of taking out a loan just to reduce the monthly payment. Although this sounds appealing short-term, it could increase your interest rates if the loan term is more than two years. This ends up costing you a lot in interest.
You also don’t want to buy the nicest car on the lot. Doing so increases your monthly payments, making every month a struggle to deal with financially. Instead, choose a used vehicle that still has what you’re looking for that’s within your means. It could also just be a temporary solution until you get a new job or bonus.
Finding the perfect bad credit used car loans is possible if you take your time and avoid certain mistakes, which many have learned the hard way.
It’s a well-known fact that not everyone can easily achieve good credit. Yours might be less than ideal due to some unfortunate circumstances or risky spending. Fortunately, you can still secure auto loans despite having a checkered financial past. Here is everything you need to know about these loans for a smart purchase.
What Are Bad Credit Auto Loans?
Bad credit auto loans function just like regular auto loans, with some adjustments made based on your credit. The lower your credit score is, the higher your interest rate will be, as lenders see you as a higher risk. Checking your credit score gives you an accurate idea of how much interest you’ll end up paying.
How do You Get These Loans?
Probably the easiest way to secure a bad credit auto loan is to get one from the dealership you’re doing business with. Before doing so, make sure you’ve already checked your credit score and know the interest rates you can expect.
After sitting down with the dealership’s financing officer, you can start looking at the terms and rates offered. Know that you don’t have to agree to anything if the terms don’t work based on your financial situation.
You can obviously see the numerous similarities between auto loans for bad credit and regular auto loans. Though it often comes with an increased interest rate, at least you can find a means of transportation to start your journey towards a better life.
Whether you are in the mood for an adventure-filled vacation or one filled with tranquility, the country’s highways are ripe with possibilities. If you don’t have a reliable vehicle or one comfortable enough for your family, your first stop should be at the nearest used car dealerships.
A Wide Selection of Vehicles
Here, you will find an inventory of used cars, pickups and vans. There is sure to be a perfect match for every driver. Even if you are a car buyer with a questionable credit history, a used car dealership can help you secure the financing that you may need.
Great for Families
Driving in your car puts you in charge of where you go and when you get there. If you have small children who need breaks from the road, you can take days to meander on the Columbia River Scenic Highway in Oregon or the Cascade Loop in Washington. Choose to camp along the way or stay in inns, motels or bread-and-breakfast spots. You can decide on your own itinerary and the timetable.
Picnic Every Day
Pull off at a rest stop or a roadside table and pull out the picnic basket. This is a pleasant break from driving and gives everyone a chance to simply enjoy the scenery. Have the kids help plan the menu and pack lunch every morning. After lunch, a nap on a blanket under a shade tree is a real treat.
If you’ve had credit problems in the past, it might seem as though your ideal car is out of reach. However, keep in mind that the fact that having bad credit doesn’t necessarily close the door on a car loan. More often than not, you should be able to find reputable car dealers for bad credit near you. At the same time, understanding how your credit score impacts your lending options can make a major difference.
What May Affect Your Credit Score?
Many people don’t realize that late payments aren’t the only thing that affects your credit score. Immigrants who haven’t lived in the country long may need to build up their score, as well as
younger adults. However, it can be easy to build up your score a little over a
matter of a few months.
A Little Searching Helps
You’ll be relieved to hear that many lenders specialize in loans for bad credit. Sometimes, these lenders will have a special relationship with certain car dealers. Consider asking the dealers you’re shopping with if they have a lender that can work with you.
Don’t Be Afraid to Ask Questions
There are a few questions to ask to make sure you’re getting a good deal. Find out how you would go about refinancing if necessary, as well as whether there’s a penalty for early
repayment. You want to make sure you have every possible advantage when you take out a loan.