Getting a car can be quite a challenge for people who have a poor credit score. There arent many bad credit car dealers willing to take this kind of risk. Is this the end of that dream car? That depends on a few things.
There are a number of financing institutions willing to help people with bad credit scores purchase a car. Applying and getting approved can be a hassle with a poor credit score. It can be frustrating when a great car comes by only to be denied of a car financing.
To avoid this frustration, do some research and look for institutions that offer car financing even on bad credit.
What to expect
When availing the services of a company specializing in bad credit car loans, the following can be expected:
Finances have to be cleaned up to get a better deal when availing of car financing options. People with bad credit are often taken advantage of if they do not know how the entire process works.
What to do to avoid getting advantage of?
Here are a few things to do in order to avoid getting a bad deal when availing of financing for a car on a bad credit:
There are still a few ones, although not as good as when applying with a good credit score.
Preparing to get a good deal
To avoid getting ripped off and avail of a better deal, be prepared. The first thing to do is to get a copy of the credit history, whether it is good or bad. This will greatly help in avoiding paying higher rates than necessary. Sure, financing for bad credits would really come with higher rates but not too much.
Avoid submitting to any loan applications. Each application that gets rejected will further lower the credit score. That means even lesser chances of getting a good deal and having it approved.
Avoid deals that require extras and options with high APR (annual percentage rate). For instance, avoid adding insurances and extended warranties included in the financing option.
These will also rack up the same high interest like the one imposed on the actual vehicle price. These can be obtained directly to service providers without going through the high APR.