Most Americans understand that we need to have car insurance for our vehicles. What most do not understand is that in order to gain access to a new or used vehicle, your credit has to be immaculate. You may find that your application is denied if you have missed just one payment in the past. Here are a few things to consider when looking for affordable car loans with a bad credit score.
Many people who have purchased vehicles know the routine. You first meet a salesperson out on the floor. They convince you to purchase a new or used vehicle. You follow them to their office and they have to do a check on your previous history. Depending upon this, you will either get the loan or you will not.
For those of us that do, we now have a beautiful new vehicle to look at in our driveway. We also have a payment to look forward to over the next few years. But for those of us that failed to receive funding, we may be wondering what we can do so that this does not happen ever again.
Before you ever walk into a dealership, you need to have an idea of how much you want to spend. You also need to know your budget and what percentage rate you’re willing to take for the life of the car payment. You then need to look at your budget for your entire household and see if getting that new automobile is really the best choice for you.
Now you need to look at how often you are making your minimum payments. If you have other debt that is virtually burying you financially, it is probably a good idea to stick with the auto that you have. If you can swing it, then it is time to look at your payment history.
Have you ever been late on any payment that you are making? If so, you need to increase your percentage rate by a couple points and also be prepared to be rejected when you go to the dealership. They do not want to have bad risk on their books and therefore if you are unable to pay your bills every month, you probably should not acquire a new source of debt.
Another thing to consider when looking for the best rates possible is to shop around and look for dealers that are desperate to sell. Some of them will ignore your credit score as long as it is not too bad. And if you think that you can make your payments based upon your monthly income, then getting that new or used car is probably a great decision.
The final tip in securing cheap percentages is through the art of negotiation. Never take the first offer presented. If you do, you are probably making a car salesman laughed all the way to the bank. But through tactful negotiation or bartering, you can lower the percentage points sometimes by half which will directly affect how much you will pay each and every month.
Finding affordable car loans is actually not that difficult as long as you have a decent credit rating and your monthly income, combined with your bills, shows a debt to income ratio that will make you a good candidate for driving away that new or used vehicle that you have always dreamed of.
Affordable Car Loans – Cheap Rates For New and Used Cars
07-06-2009 by adminNo Credit Car Loans – Car Loan Approval with No Credit History
05-06-2009 by admin
Getting an approval for a car loan when you have no credit history can often times be almost as difficult as getting a car loan approved when you have bad credit. There are things that can be done, however, which will improve your chances of finding a no credit car loan.
Ask your employer for a letter of reference – Include your length of employment, your current gross wage and your current net wages.
Prepare a personal payment history. Included in this history should be a list of all the bills you pay on a monthly basis which are not reported to the credit agencies. Ask your landlord for a letter of reference. Utility companies will also generally provide you with payment histories. If you have any small installment accounts at local retailers which don’t report credit, ask them for credit statements as well.
If you don’t already have one, open a checking account – Have your paycheck sent to your bank via direct deposit if your employer offers this service.
Open a savings account at the same institution as your checking account. Authorize a regular deposit into your savings account out of your paycheck. Link your savings account to your checking account to limit the possibility of an overdraft.
While you are shopping for the car you want and for a lender, set aside additional savings specifically for a down payment on your car.
Once you have taken these steps, you are ready to approach a lender for your no credit car loan.
The first lender you should approach is the financial institution with which you have your checking and savings accounts. Many times banks or credit unions will work with customers who have no credit histories if their accounts are in good standing and they have some sort of down payment.
When shopping for your car, look for dealers who offer credit for first time buyers. You must approach these dealers with caution. Sometimes they will inflate the car prices or charge exorbitant interest rates. Make them aware that you are looking at several lenders and will be comparing their proposals.
Allow your payment to be debited from your checking account – This may help compensate for the fact that you don’t have any credit history for the lender.
Arm yourself with knowledge. Know what the current interest rate is for the most credit worthy applicant. If you have sufficient income, a down payment and no negative credit your interest rate should not be significantly above that rate.
Be realistic about the type of car you select. You may not be able to get your dream car but there are many late model, low mileage cars for which you can qualify when seeking approval for a no credit car loan.
Most importantly, after you have successfully obtained you auto loan, make your payments in a timely manner. Do not overload yourself with debt and don’t have lenders constantly making inquiries about your credit. By following these simple rules, the next time you look for a car loan the process will be much easier.
Credit Repair Advice – How to Improve Your Credit Score
17-05-2009 by admin
Our credit scores determine much about how we live our lives. We buy practically everything on credit. When applying for a loan, our good credit scores help us receive reasonable interest rates. In fact, from landlords, to insurance companies, to utilities, everyone looks at our credit scores, as they are a reflection of our financial health. A healthy credit score may determine what various agencies will charge for their services. Today, even employers check personal credit scores before offering a job.
Knowing more about our credit scores and the factors affecting them may help us build a positive credit history. But first, let’s look at how they are maintained by the various credit reporting agencies.
Three major credit bureaus – Equifax, Experian, and TransUnion – calculate credit scores. Though they use the same methods and formula to calculate scores, they sometimes come up with a different rating for various reasons. One agency may have more updated information about an individual. A creditor may have shared information with one agency only, but not with the others. Creditors, while checking on our scores, take the average of the three scores from these three agencies.
Credit scores range between 300 and 850. A score of 680 and above is excellent for obtaining mortgage financing at low interest rates. A credit score of 621 to 679 is an average score and you would have to pay a slightly higher rate of interest. A credit score of below 600 makes us potentially unreliable and harder to obtain credit. When a credit score falls below 600, credit repair steps should be taken immediately.
The following are factors affecting credit scores and basic steps to take to maintain an accurate credit score rating with the credit bureaus:
1. Routinely check payment history and the current credit debt held.
2. Credit history length is a determining score factor. Naturally, the longer a ‘good’ credit history, the better.
3. Do not close old or paid off accounts. These show the credit history length and contribute to higher credit scores.
4. Pay off debts to improve credit scores.
5. On-time payments. Delayed payments appear on credit reports and adversely affect it.
6. An individual’s race, sex, age, level of education, or marital status has no bearing on a credit score, nor does the fact that an application for credit was previously turned down.
Taking care to maintain a high credit rating enables us to receive credit and loans at good rates. Our credit score is a reflection of how we manage our finances and a determining factor for many aspects of our lives. Knowing early on how to have a healthy credit history is the best way to avoid bad credit and limited loan options in the future.