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The three main credit reporting agencies are Equifax Experian and TransUnion. 3. Know Your FICO Score This plays a big part in whether you will be approved and the interest rate of your auto loan. Your FICO scores are the credit calculations or scores many lenders use to determine your credit worthiness. The FICO credit score range is widely accepted to be between 300 and 850 the higher the better. Raising low FICO scores not only can help you get the lowest interest auto loan but will also save you thousands on the total cost of the car. 4. Dealing With Bad Credit It is not impossible to get a low interest auto loan with bad credit. In a perfect world you will have your bad credit erased but as you know this can take time. Time which you may not have before you need a car.
It is quite common for such individuals to apply for car financing and end up with rejected car loan applications. The common reason being improper preparation of the application or applying for the wrong kind of auto loan at the wrong time. Due to the ongoing economic recession many of the moneylenders have started offering credit facility to borrowers having low FICO score and poor credit history in the form of bad credit auto loans simply because they need to sell their loan products and earn some money in the form of interest. Having stringent measures would mean less business and lesser earnings because there is no way the bulk of the market applicant would satisfy the harsh requirements. So what is the way out for the person if he or she wants to avail the auto financing facility and has bad credit ratings? The following pointers can help you in deciding how to go about the problem. Special Auto Finance Facilities for Individuals Having a Bad or Poor Credit History Traditional loan providers need good or excellent credit ratings and a high FICO score before they provide their credit.
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This is very important you should shop around to find the best deal. However keep in mind that there are different factors at play with each lender as to whether or not you get a loan and if so at what interest rate. You can get approved for a auto loan. But lets be clear obviously you are not going to get the preferred interest rate on a car loan that a person with A+ credit will receive. However with a little research especially online you can find the best auto rate quote that meets your circumstances. Most people just dive head first into the auto financing process when buying a car giving no thought to how the auto loan interest rate affects the overall cost of the vehicle or monthly payment. With no plan of action or alternative financing source this results in them receiving high interest rates and high processing fees which lead to high monthly payments. It is vital that you make a plan especially if you carry a bad credit history. As you know it can be difficult to finance a car with poor credit.
Do not use monthly payments as the only factor for comparing loan quotes. You must consider APR interest rates car loan term others fees and charges etc. This will give you a more comprehensive result. Second Chance Auto Loans Online In years past if you had bad credit a bankruptcy or repossession in your credit history it was virtually impossible to apply for auto loans through automobile dealerships or even directly through the auto finance firm; the answer was almost invariably "no". This created an uncomfortable and embarrassing experience for many people that found the car that they wanted at a dealership only to be turned away. With the advent of the Internet giving consumers ability to search for an online auto loan automobile dealerships and auto loan finance companies now have to compete much more vigorously to get a consumers attention let alone their business; today it is a borrowers market.