When your credit isn’t great, it can feel like no bank or lender will give you the time of day. But that’s not actually true. Thanks to shifting perceptions by lender, and changes in the auto financing market, a bad credit car loan is more than possible. It will, however, require more work, and visiting the right lender.
The Importance Of Quotes And Paperwork
Before you sign up for any sort of bad credit auto loan, you should be aware of your options. Make a point of collecting quotes from lenders before you sign any sort of loan. Why? The ideal auto loan is one for the least amount of money with the lowest interest rate across the shortest amount of time. So look for the loan that allows you to meet those standards.
Similarly, have your paperwork together. Keep your tax returns for the last few years handy, in case you need to prove income, and keep a few current pay stubs on file so you can refer lenders to them. So, with all that in place … where to find a poor credit car loan?
It’s not recommended that you get your financing from a dealership if you can avoid it. While the stereotype of the sleazy car salesman is largely only found on television, the truth is that many dealers can’t really offer you as broad a range of options as other lenders. This is due to where they secure their financing; they’re often just the intermediary between you and an automaker’s lending arm, so they can only offer you one deal.
Still, it’s worth asking to see if they can work with you and your credit. If not, you can at least get a sense of what they need from a car loan with bad credit to sell you a car.
If you have a standing relationship with a bank, it can be an excellent place to start looking for poor credit auto financing. If you have a long history with a bank, they’ll know you and your finances fairly well; how much you make in a month, what you have in your accounts, and other useful data.
That said, even if they offer you a good quote, you shouldn’t necessarily take it. Especially with bad credit auto loans, you’ll need to look at all your options. But it can be an efficient process, and the quote you receive will be a good starting point.
Finally, you should actively seek out alternative lenders. The auto financing industry has shifted in some surprising ways over the last few years, especially as it’s become clear that while the economy may have knocked a few of us off our feet, we still need cars, and we still need financing for cars. As a result, alternate lenders have begun appearing to help those of us who need bad credit car loans.
In short, even with poor credit, you have options. Be a smart consumer, and get the quotes; you’ll be surprised by the deals you can get even for a bad credit car loan.