Poor credit history can definitely come in the way of your loan application process, once you have decided to buy a dream car on loan. However, you should not allow bad credit to discourage you from figuring out the ways to get the loan successfully.
Please look at the below steps and guidelines make the best opportunity for getting a loan on damaged credit history:
Being aware of where you stand: One of the first steps, when you start the process of the loan application to buy the car, is to know what your credit reports are telling you. Find out a reliable credit agency, preferably recommended by consumer financial protection bureau.
Look for the accurate report and immediately notify if there is any error which can become a hindrance and prevents you from getting the deserved credit from lenders.
- Look for options
It is important that you first shop around to understand the market. This will basically help you in understanding and compare different options like what are rates different lenders are offering, what are the credit norms, what all documentation you need etc.
Keep this ‘shop around’ period for 15-45 days max so that your search is considered as one and will not affect your credit score further.
- Search for good lenders
Do some research on good lenders who have lenient credit rules. Check different options such as auto dealerships, finance companies, credit unions, banks and look for lenders who are more open with different credit types.
Another important consideration is to work out your affordability by doing a fair calculation of your budget based on income and liabilities. With a damaged credit history, the lender might ask for a down payment as safety.
Give some extra thought on what add-ons like warranties, service contracts, etc. you might need as this will affect the final decision of how much credit you are eligible for post accounting for everything.
- Looking for direct lenders
One of the options you might want to look at is the search for direct lenders. These are the agencies who willingly accept applications from all type of consumers including the ones with not so good credit history.
- Start with a known place
Always start your loan applications with the bank where you a checking or savings account. You will have the benefit of familiarity and higher chances of getting the credit.
- Beware of the fraudsters
Damaged credit history might encourage you to go the dealer route but be very diligent, alert and don’t fall victim of higher interests or down payments as compensation for bad credit history.
Damaged credit history is surely not a great situation to be in, but that does not necessarily mean the end of the options. Understanding the situation along with solid research and a fact-sheet ready is the beginning step to apply for the car loan. Apply for auto loan-New car Canada for a fair chance of getting the loan even with damaged credit history.