If your vehicle appears to want to give up and you currently have bad credit, the question how to buy a car with bad credit may come up. Buying a car under such circumstances may seem daunting and even impossible. Although bad credit does throw a few obstacles in the way, you still have options.
Bad Credit and Your Credit Report
Request a free copy of your credit report. Knowing your credit score prior to applying for an auto loan can help you speak intelligently. You want to let others know that may have experienced bad credit due to circumstances beyond your control, but you are still in control of your finances.
Bad Credit Auto Loans and Large Down Payments
If you can afford it, offer to put down a considerable amount. Depending on your particular situation, some lenders are more likely to consider financing your auto loan if you put down a considerable down payment.
Bad Credit and Subprime Auto Loans
Although not the most advantageous solution, if you have bad credit, you will most likely not qualify for a conventional loan. Subprime programs often accommodate consumers in financial straits. This type of financing does mean higher interest rates; however, if it’s your only option, it could provide the transportation you need to get to work, and keep your job.
It is normally better to obtain a bad credit auto loan directly from the lender, but if you prefer, you can look for dealerships that offer subprime lending. Car dealers often have a network of such lending institutions. They submit your application to multiple banks in their network until they find one that will accept your application.
Buy-Here-Pay-Here Car Lots: Financing for Bad Credit Auto Loans
Once again, this is not necessarily the ideal solution, but if your main objective is to have transportation to get to work, it might be the answer to your bad credit problem. Depending on the car lot you choose, if you can show proof of steady income, it might suffice to qualify for a loan. Although some dealers might run a credit report, it’s generally understood that the majority of applicants at this type of car lot have bad credit.
For tips on how to find buy-here-pay-here car lots and how they work, please refer to the resource section at the end of this article.
Pay Cash: Best Option When You Have Bad Credit
Paying cash for a car is normally the best option in most circumstances. Why not look for ways to raise money to pay cash for a used car? You may need to buy an older model vehicle. As your situation improves, you can upgrade to a newer one. You won’t have the latest model, but you won’t have to worry about monthly payments or a high interest rate either.
Having bad credit may present some challenges, but it’s no reason to give up or become anxious. Work with your current situation and strive to improve it. Keep in mind that having bad credit does not mean that you cannot negotiate the price of a car. If you don’t feel comfortable with a dealer’s tactics, walk away. You can find the same deal or better somewhere else.
Copyright © 2011 Ana Jackson. All Rights Reserved. Reproduction in whole or in part constitutes plagiarism, is illegal and strictly prohibited.
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