For some people, finding a poor credit car loan is harder than finding Waldo. Constant rejections and high rates dampen the spirits of poor credit car buyer. But, don’t think that your credit score will make it impossible to get auto loan approval.
With the recession, poor credit history has become very common. Today, lenders cannot ignore car borrowers with credit issues because they represent a huge market opportunity. So, don’t think that auto loans are not made for poor credit people.
To get quick approval on your poor credit car loan application, here are 4 Cs. Easy to remember and essential to follow, make sure that you work on them before starting your car loan quest.
Seeing is believing!
Never believe what others tell you about your credit score. Check it yourself before assuming any financial responsibility. By knowing your credit score, you can know the average rates that you will receive. This way you can stay away from lenders who offer exorbitant rates on poor credit car financing programs.
Also, don’t forget to analyze your credit report. Credit bureaus are infamous for making errors in credit reports. You certainly don’t want any erroneous entry to reduce your approval chances.
Even if you are getting a poor credit auto loan for your car, you need to know how much money you can direct towards monthly payments. You must remember that loan programs are good only when you can make on-time payments.
You must also consider down payment. Paying cash and reducing the loan amount can decrease your loan rates. Also, down payment will show your financial capacity to the lender. This will reduce the negative effect of your poor credit score.
Most people consider co-signing a pain. But, having a co-signer can actually improve your chances of getting poor credit auto loans. A co-signer ensures the lender that his money is safe. So, it is important to convince someone to become your co-signer. It can be anyone with a good credit score and a debt-to-income ratio below 40%.
A vehicle provides convenience. It shouldn’t become a burden for you. Opt for a car by keeping your budget in mind. It is important for a poor credit car buyer to keep his car cost in control. If you opt for an expensive car model, your car loan will be higher. This will make monthly payments difficult for you. So, make sure that you choose an economical automobile.
So, these are the 4Cs which can help every poor credit car buyer. These factors have been designed after considering the car loan approval factors. If you take care of them, approval on poor credit auto loan will become totally stress-free.
Best of Luck!