Shopping For Auto Financing With Poor Credit.
Steps You Should Take Before You Start Shopping For A Bad Credit Auto Loan!
Searching for a decent pre-owned vehicle is not easy, but if you are looking for bad credit auto financing on top of that it can become a daunting task! Usually its simple to spot a worthwhile deal at a local car lot. Just make sure that if you are financing the car and you have bad credit that they don’t try and sneak in a few extras that you really do not want. These types of tricky tactics are how some auto dealers get you to spend more cash than you actually want to spend.
Having poor or a bankruptcy can be a extremely discouraging when your dealer comes back to you with an extremely high interest rate on your auto loan. It sort of makes you believe that there is no way you can get a good deal on an auto loan if you have poor credit.
One thing you can do is keep in mind that used car lots are in business to make profit. If for any reason you feel like the dealership is not looking our for your best interest, you can walk away and tell them that you would like to think about it and take your business to another dealership. My goal for writing this article is to give people some insight of how to get prepared to get the fairest possible deal on a poor credit car loan, before you step foot inside the auto dealership.
The most important thing to get before you shop is “Credit FICO Score”. You need this in order to receive an idea of where you stand and how damaged your credit really is. Most of the times people go about the whole car loan process backwards. They go to a dealership, find a nice car that they agree to purchase and then the representative comes back with an auto loan approval only to tell you that you barely qualified for this car because of your limited credit history and credit score. They may just be trying to charge you a higher interest rate and in turn make a few thousand dollars extra on your deal, than if you already knew what your credit history looked like. a 1 to 5% increase in your interest rate can mean as much as $3000 more in interest payments coming out of your pocket over the life of the loan! This is obviously something you want to avoid.
Initially, do a search on Bing for free credit reports with credit scores. You are going to need to arm yourself with an accurate credit score from all three major credit bureaus: Experian, Equifax and Trans-Union. You are actually eligible for a for a free credit report every year, so take advantage of that so you can get the best deal possible on your car financing.
The most important part of a credit report used for determining your credit strength is your FICO Score. This score is determined by a calculated formula used by the credit reporting agencies. Usually your credit score can be as low as a 400 and as high as 850 to 900 in some cases! As the score gets higher typically over 700, thats when you start to reap the rewards of getting a decent deal. If you do not know your FICO score, you may be led to believe that with your credit history this is all you qualify for. This way they can charge you more interest and in the long run you can end up paying thousands of dollars more over the life of the car loan. Remember used car lots are in business to make a profit, and given the chance, that is exactly what they are going to do. Don’t get me wrong, car stores do deserve to make money or they could not keep their doors open and pay their bills. But consumers also deserve to get a honest!
Bad credit auto loans are a common thing these days. In this economy these types of loans are searched for by people on a daily basis. You can search for bad credit auto loan financing on Google, and find destinations like KarLoans.com that have helped people like you for over a decade!
