In the market for a new car but worry that your low credit score will put the brakes on getting a good deal? Don’t worry, bad credit buyers have been receiving loans at an increased rate. A credit analysis recently released found that more buyers with poor scores are getting approved, and adding their lower scores to the mix has brought average scores down almost to pre-recession levels. If you’re looking for a new car there is good news. Here are some tips to getting a bad credit auto loan:
1. Know your score before you shop. Not only should you look at your credit report, but you must know your credit score. This way you’ll have the most recent information and not an old score. To learn more visit completeautoloans.com for a free credit score.
2. Check on average interest rates for your score. Check online for what interest rate usually goes with the credit score you have. This way you won’t be surprised by a dealerships offer. Also, you can check what monthly payments are like for a particular interest rate.
3. Don’t assume your score is too low. Actually there is no line under which you automatically cannot get a loan. Especially since one lender might take a credit score that another won’t.
4. If you have a low score, save up. Car buyers with low credit should save up a down payment. Usually at least 20 percent of the purchase price as a down payment on a new car and 11 percent on a used car will make the loan approval process easier. Making the highest down payment you can is important, especially if you have poor credit.
5. Consider a reliable used car. A used car can provide a good value for a lower price, which can be especially helpful for consumers with a bad credit score. The interest rates usually are higher for used car loans. Car buyers should check pricing guides to make sure they know the true value of the car they want to buy. Whether you buy new or used check on the cars reliability, the cost of the financing and your ability to repay the loan.