Posted on Dec 07, 2011 by Albano Stefani
Dec
07
If you need a car and have poor credit you may be worried about getting a loan. Many people with credit problems find it difficult to get lenders to take their business. Rest assured that you are not alone. Millions of good people suffer from poor credit from time to time. There are many banks that will extend you a poor credit auto loan. Finding the right one requires a little knowledge, but there are companies that will lend to you.
Know Your Score
It's not enough to just know that you have poor credit. Knowing your actual credit scores with the three major credit bureaus is the first step in getting the best rate for your auto loan. Your score may not be as bad as you think, and you may actually qualify for a lower interest rate than you expect. Late payments, reposessions, bankruptcy and foreclosure can all effect your score. However, there are many buyers with these credit problems that get approved for an auto loan. Know your score before you shop and you may be able to negotiate a more favorable rate on your car loan.
Newer is Better
Did you know that it can be easier for a person with poor credit to finance a newer car than an older one? When banks consider whether to extend you credit, they also consider your motivation for paying on your loan. If you are purchasing a high-mileage car, chances are that the car will need major repairs within a few years. The banks assume that a person will be more likely to make regular payments on a car that is in good working order than one that is in need of repairs. Therefore it is sometimes easier to get a loan on a car that is newer and has a longer lifespan than one with high mileage.
There are many banks available that will extend you a poor credit auto loan. Shop smart and know your credit score and you will be on the road to driving independence in no time.