Smart Spending

Where to Get a Car Loan If You Have Bad Credit

After the recent economic problems that our country has experienced, there is no doubt that it is now harder to get a car loan than it was before. The good news is that it is still possible, but you have to know where to get a car loan in today’s economic climate.  Car loans can be obtained even with bad credit, says BankRate.com, because a lender knows that if you do not pay, they can rather easily repossess your car. So, instead of worrying about whether or not you can get an auto loan, focus on trying to get the best deal you can.

Start out by taking a good look at your credit score. The lender will be sure to look at this, as well as your employment – and possibly your income, too. Get your credit reports and make sure that there are not any problems with the things that have been reported on them. If there are mistakes, you need to wait up to about six weeks after any corrections to be sure that they have been reported.

Go to your own bank first, and see what kind of rates they will give you. They are already familiar with your finances, and may be able to give you a better deal. At least find out what they can do, and then go to other lenders and get a quote for comparison.

You need to be aware that different lenders will look at your credit score in different ways. Some may be more interested in giving you a used car loan than with your credit, if it is not too bad. Others may reject you, but you won’t know until you try. Don’t stop getting quotes either, until you have several, because a better deal may be at the next lender you visit. You can do some of this online, but you may want to visit lenders that are local to you.

When you have bad credit, you want to be especially careful not to buy more car than you can afford. Building your credit comes when you make your payments on time and for at least the minimum amount due. You need to be sure that you can do this consistently, and when you do, it will raise your credit score over time. If necessary, you might use a car loan calculator, such as the one at Money.MSN, to help determine what your monthly payments will be. Don’t forget to find out how much your car insurance is going to be, too, before you buy.

Be careful to not extend the car loan over too long a period a time. If you do this, two things can happen. First, you will be paying a lot more for the car than necessary. While it will give you the benefit of lower payments, sometimes, longer car loans have higher interest rates. A second problem is that, if you are buying a used car, that the car may become worthless before you finish paying for it – and then you have to buy another one.

You can get a pre-approved car loan from a lender even before you go shopping. This will tell you what the bank thinks you can handle financially, and then you simply take the check to the dealership. By knowing where to get a car loan before you go shopping, you can negotiate with confidence.  Be sure to haggle with the dealer, because this will give you an even better deal – and lower payments. Since you will be writing in the amount on the check once the agreement is completed, you will only owe the amount for the car you agreed to on your car loan.

After the recent economic problems that our country has experienced, there is no doubt that it is now harder to get a car loan than it was before. The good news is that it is still possible, but you have to know where to get a car loan in today’s economic climate.  Car loans can be obtained even with bad credit, says BankRate.com, because a lender knows that if you do not pay, they can rather easily repossess your car. So, instead of worrying about whether or not you can get an auto loan, focus on trying to get the best deal you can.

Start out by taking a good look at your credit score. The lender will be sure to look at this, as well as your employment – and possibly your income, too. Get your credit reports and make sure that there are not any problems with the things that have been reported on them. If there are mistakes, you need to wait up to about six weeks after any corrections to be sure that they have been reported.

Go to your own bank first, and see what kind of rates they will give you. They are already familiar with your finances, and may be able to give you a better deal. At least find out what they can do, and then go to other lenders and get a quote for comparison.

You need to be aware that different lenders will look at your credit score in different ways. Some may be more interested in giving you a used car loan than with your credit, if it is not too bad. Others may reject you, but you won’t know until you try. Don’t stop getting quotes either, until you have several, because a better deal may be at the next lender you visit. You can do some of this online, but you may want to visit lenders that are local to you.

When you have bad credit, you want to be especially careful not to buy more car than you can afford. Building your credit comes when you make your payments on time and for at least the minimum amount due. You need to be sure that you can do this consistently, and when you do, it will raise your credit score over time. If necessary, you might use a car loan calculator, such as the one at Money.MSN, to help determine what your monthly payments will be. Don’t forget to find out how much your car insurance is going to be, too, before you buy.

Be careful to not extend the car loan over too long a period a time. If you do this, two things can happen. First, you will be paying a lot more for the car than necessary. While it will give you the benefit of lower payments, sometimes, longer car loans have higher interest rates. A second problem is that, if you are buying a used car, that the car may become worthless before you finish paying for it – and then you have to buy another one.

You can get a pre-approved car loan from a lender even before you go shopping. This will tell you what the bank thinks you can handle financially, and then you simply take the check to the dealership. By knowing where to get a car loan before you go shopping, you can negotiate with confidence.  Be sure to haggle with the dealer, because this will give you an even better deal – and lower payments. Since you will be writing in the amount on the check once the agreement is completed, you will only owe the amount for the car you agreed to on your car loan.