Steps You Should Take Before You Start Shopping For An Auto Loan With Bad Credit!
It can be hard enough finding a good used car that will be reliable and give you at least a few years of good service. But finding that along with an auto loan to go along with it, if you have a low credit score can be a lot more challenging. There are plenty of car dealerships out there that will give you a honest deal on a new or used car. The problem is that when you do find that good deal, make sure the dealer does not try and add in tons of extras that you do not need, that will do nothing but wind up costing you a lot of money that you really cannot afford to lay out!
Having poor or a bankruptcy can be a extremely discouraging when your dealer comes back to you with an extremely high interest rate on your auto loan. It sort of makes you believe that there is no way you can get a good deal on car financing if you have a low credit score.
At times this can be the case but one thing to remember is that car dealers need to sell cars. Don’t be afraid to walk away and try your chances at another dealer if you feel you are not getting a honest deal. The message I will try and get across to most readers of this article is what to do to prepare yourself to get a great deal when shopping for an auto loan quote online.
The most important thing to get before you shop is “Credit FICO Score”. You need this in order to receive an idea of where you stand and how bad your credit really is. Most of the times people go about the whole buying process backwards. They go to a car showroom, find a nice car that they love and then the dealer comes back with an auto financing approval only to tell you that you barely qualified for this car because of your bad credit history and credit score. They may just be trying to charge you a higher interest rate and in turn make a few thousand dollars extra on your deal, than if you already knew what your credit history looked like. a 1 to 5% increase in your interest rate can mean as much as $3000 more in interest payments coming out of your pocket over the life of the loan! This is obviously something you don’t want happening.
Your initial step should be to go on the internet and find a company that offers credit reports with FICO Scores. Get a credit report with scores from all the three major credit reporting agencies such as Trans-Union, Equifax and Experian. All three credit scores will vary slightly but you can use the highest score of the three to your advantage if you have to! Also remember that if you contact the credit bureaus directly, they offer you a free credit report once a year. This is something that everyone should take advantage of, and is very important if you want to get a good deal on your next bad credit auto financing.
The most important part of a credit report used for determining your credit strength is your FICO Score. This score is determined by a calculated formula used by the credit reporting agencies. Most of the time your credit score can be as low as a 400 and as high as 850 to 900 in some cases! As the score gets higher typically over 700, thats when you start to reap the rewards of getting a decent deal. If you do not know your FICO score, you may be led to believe that with your credit history this is all you qualify for. This way they can charge you more interest and in the long run you can wind up paying thousands of dollars more over the life of the car loan. Remember car store are in business to make money, and given the chance, that is exactly what they are going to do. Don’t get me wrong, used car lots do deserve to make profit or they could not keep their doors open and pay their bills. But consumers also deserve to get a honest!
Many people try and find auto loans after bankruptcy but seem to have a hard time. You can easily find a bad credit auto loan by visiting eCarLoan.us the #1 destination for online car credit!
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