Is it still possible on poor credit Car finance to speed up application approval?
Car finance companies are more hesitant to approve loans of this kind. An applicant with poor credit will have to do a few extra steps in order to secure a good auto loan. These steps aim to convince the lender that the applicant has the capability to pay off the loan. These steps also aim to assure the lender that the applicant can be relied on to make timely payments.
Most people with bad credit seeking for car financing are often vulnerable to getting bad deals. They are more prone to signing a loan deal with interests that are too high. They are also more prone to take on extras with their loan terms. Some feel too desperate or too grateful that a lender is giving them a chance to secure a loan. Avoid falling for these and get a fair terms with these tips.
Step back and assess if the car is really a need
Seeking for a car loan on bad credit is a huge risk. Apply only if the car is a real need and not for luxury. Be mindful that this situation has a huge chance of bringing the credit score to an even lower level. An untimely payment or forfeiture will further lower the credit score and make future loans even more difficult to secure.
Most financial advisers recommend waiting for 6 months to rebuild the credit before applying for a car loan. That is, if the car is not an immediate need. Merely waiting for a while can greatly help in improving the credit score and securing better loan terms and lower interest rates.
During this waiting time, the applicant is also recommended to pay bills on time. This will greatly improve credit score. A month or two of timely bills payments can go a long way to bringing up the score. The difference can make a real difference in securing lower interest rates in car loans.
Check the credit report
It is always better to personally check the credit score. Lenders will check the applicants score for themselves. An applicant who knows his own credit score is less likely to get pulled into bad loan terms.
Check for activity/ies that affected the credit score. Take note of any activity that may have brought the score low. Bring the report when meeting with a potential lender. During the interview, the applicant can justify or explain the cause of the low credit score. Lenders are willing to work things out if the applicant can adequately explain these items.
Look for different lenders
Desperation is common among those who have poor credit. Car finance for this situation are available across the country. An applicant should not think that a bad credit is impossible to secure a fair loan term. Shop around and look for the best deal before applying and signing up for one.
Check the credit score and look up the different interest rates currently in place for that particular score. Compare this with the rate offered by the car dealer.
Feel free to negotiate to get a fair deal. Remember, a bad credit isnt necessarily a reason to agree to be taken advantage of.