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Mar

Auto Loan - How to Get Approved for a Bad Credit Car Loan

Posted by admin  Published in Auto Repair Loans
Tip! First, you’re paying a very high interest rate at 16.4% APR for an auto loan! I’m going to assume that your statement as to your good credit is accurate.

Auto loans are easier to get approved for than other, unsecured lines of credit because they are secured by the car you purchase. So, even with bad credit, it’s possible to get approved for a bad credit car loan. This article offers tips on getting approved for an auto loan with bad credit:

bBorrow Less Than the Car Is Worth/b

If you have bad credit, lenders are going to want to make sure that, even if you don’t pay your loan, they can resale the car and get their money back. For this reason, it’s important that you take out a loan for less than the car’s appraised amount. For example, if the car you’re buying is worth $15,000, you’ll want to borrow less than that amount. Usually that means making a significant down payment. Making a down payment makes you less of a risk to a borrower, therefore improving your chances of being approved.

bSearch for Lenders Online/b

Tip! 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.

If the only place you search for a car loan is the car lot, then you’re not going to know whether the rates they’re offering you are reasonable or not. Dealerships are notorious for telling people that they cannot get approved for a better loan because of their credit when, in reality, this is not true. Even with bad credit, on a secured loan you should be able to get a decent interest rate. Shop online before going to the car lot and get an idea of what type of loan you can get from other lenders.

bMake Timely Payments on Your Other Credit Accounts/b

In the months before you apply for a car loan, make timely payment on your other credit accounts. Even if you just have a few months of timely payments prior to applying for an auto loan, it will look much better than applying for a loan with recent negative reporting from your other creditors. If you can prove that your poor payment history is a thing of the past, a lender is much more likely to approve your car loan.

Tip! 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 don’t.

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Visit Car Loan Sense to view our a target=_blank target=_New href=http://www.carloansense.comRecommended Auto Loan Lenders/a online. Also, visit Car Loan Sense for help finding a reputable a target=_blank target=_New href=http://www.carloansense.com/Getting_a_Car_Loan_with_Bad_Credit.shtmlBad Credit Auto Lender/a.

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