How to Get Bad Credit Car Loans
The shaky economy has made many people end up having bad credit. However, all is not lost just because you have bad credit. Troubles associated with bad credit can be overcome using simple day to day measures. These measure are not only easy to understand but can also be implemented with just a small measure of discipline and willpower.
Before and when applying for a bad credit car loan, there are a number of steps you should follow. When you get an affordable bad credit car loan, it will be easy to improve your credit score.
Here are the steps to follow before applying for a car loan:
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i) The first step is to get your credit report. Most banks and credit bureaus provide customers with these reports free of charge annually.
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ii) You should take steps to improve your credit score to increase your chances of getting approved for a bad credit loan. This may prove to be time consuming but will ultimately be worthwhile.
iii) Lenders are more likely to approve your application for a loan if you are employed. In fact, it is recommended to be in one employment for at least ninety days or more. You are also likely to be given better terms if you are in permanent employment.
iv) A reasonably big down payment will go a long way in getting the confidence of the lenders. This ultimately serves as security for the car.
v)Having bad credit doesn’t mean you are not entitled to shop for the best terms. When you shop around and compare the interest rates charged by different companies, it will be easy to know which one to sign up with.
vi) Contact lenders that offer bad credit financing to apply for a car loan.
Steps to follow during application for a loan:
i) Go for a used vehicle instead of one that is new to keep your costs down. This will automatically mean lower monthly payments and a lower loan amount. This will also lead to lower risk to the lender.
ii) Get yourself a guarantor with good credit history. This will ensure you end up better loan terms.
After getting approved for a bad credit loan, work to improve your credit rating by keeping a budget and paying your bills on time. If you can, look for an additional job that will bring you more income and make it easier to pay back the loan.