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Does Bad Credit Equal A
High Interest Rate On Your Car Loan? |
Picture this. You need a new set of wheels and you need them in a
hurry. The only problem is you don’t have the disposable cash to buy it
and you know your credit record leaves a lot to be desired. So what do you
do? Resort to grabbing the bus every day or go for an auto loan instead?
Most people would put their hands up at the suggestion of an auto finance
loan. It solves all your problems, giving you the cash you need to buy
that new car up front, and allowing you to pay it back monthly at an
agreed rate.
But hang on a minute – aren’t interest rates for bad credit risks going to
be sky high?
It’s a fact of life that someone who is an excellent credit risk is going
to get the lowest rates. But it doesn’t work in quite the same way in
reverse. It’s easy to assume that the worst credit risk is automatically
going to get really high interest rates. But this is where the logical
thinking can break down.
The truth is that there are companies around today who specialize in
providing competitive car loans for people who don’t have a good credit
record. The trick is to shop around and make sure you get the best rate
you can.
Some people are surprised at just how much they can do to help themselves
as well. For instance, let’s say you are looking to borrow $15,000 to
finance that new car you’ve got your eye on. You might find you have the
option to spread your repayments over different lengths of time. But this
could involve different rates of interest.
Generally speaking you should get a better rate for agreeing to pay the
money back faster. You should always be sure you agree to what you can
afford of course. There is no point agreeing to a lower interest rate for
paying back $300 a month if you can only afford to pay back $150 a month.
Always ensure you pick the right loan and terms for your needs.
Another example would be the advance payment you make on your car. If you
can put 20% down you’ll get better terms than if you only put 5% down.
Crunch those numbers carefully and work out what you can afford to do
before agreeing to the terms of any loan. This will help you to get the
lowest possible rate for your situation.
Auto loans have enabled lots of people with bad credit to get the car they
desperately need. It can be easy to jump at the first offer you get when
you need a loan in a hurry, but as you can see it is vital to remember
that lower rates are available to everyone. Even if your credit score
isn’t something to be proud of, you can still make the most of it and
secure a low rate for your car finance repayments.
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2019-11-16 |
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If you've got bad credit and you're looking to buy
a new or used car, you're in the right place. Just
click below to start the bad credit application! |
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