Tips on Improving Your Chances of Qualifying for a Used Car Loan

When you have poor credit, you might think that even qualifying for bad credit car loans is far beyond your reach. This can be frustrating, especially when owning a car could help you get a better job, make transporting your family simpler and overall improve your quality of life. However, there are ways to improve your credit and increase your chances of getting approved, and we’re here with a few tips on how to get started.

Be Informed About Your Credit

If you haven’t looked at your credit score lately because you know it isn’t what it could be, knowing the truth is a smarter move than ignoring it. Check your score, accept the number and then move forward with improving it. Order a copy of your credit report and review it to ensure all the information being reported to prospective lenders is correct. Being informed about your credit can help you take the first steps to repairing it.

Pay Off Small Debts

Small debts on your credit report can damage your score and lower it more than you might think. When you receive your report, start with noting smaller charges and then make serious efforts to pay them off. The more debt you clear, even smaller amounts, can help raise your credit score and make you more creditworthy in the eyes of car dealerships.

Avoid New Debt

If you plan on seeking out bad credit car loans in the near future, it’s wise to avoid incurring any new debt beforehand. Opening high-interest credit cards, buying expensive items on credit and carrying multiple late payment fees on your rent or other loans can all reduce your chances of securing any kind of used car loan.

Even if you have poor credit, bad credit car loans may be available from local dealerships. However, taking steps to improve your creditworthiness by avoiding new debt and being well informed about your current credit status can improve your chances of securing an affordable loan.

Understanding the Types of Cars

We carry a lot of used cars on our lots, in many makes, models and years. We frequently get people shopping for cars that don’t fully understand the options available to them. So here is a quick refresher course on some of the main varieties of cars that you have to choose from.

 

Sedans

 

These have been historically among the most popular of cars and have often been synonymous with family car. They are usually four doors with a separate space for storage in the back, most commonly a trunk. They often get good to excellent gas mileage, and are sometimes equated with practicality. They commonly seat 4 to 5 people.

 

Coupes are a type of sedan that may only have two-doors and may have a sporty accessory such as a spoiler. The backseat also tends to be smaller in coupes, though the term is somewhat flexible and used interchangeably with sedan.

 

Hatchbacks

 

Similar to sedans, hatchbacks differ mainly in the rear compartment, which has a tailgate that lifts up for easier access than a trunk. It’s preferred by buyers who like to put groceries in the back or other supplies, and it sometimes has a slightly sportier appearance.

 

SUVs

 

SUVs are larger than sedans and hatchbacks, seating up to 5 to 7 people. They usually have higher ground clearance, giving the driver and passengers an elevated view of the road. Because they have heavier bodies they tend get reduced gas mileage.

 

Crossover

 

This style of vehicle has become quite popular in recent years. It combines qualities of an SUV and a sedan, and again the definition is somewhat flexible. In terms of construction, a crossover is more closely related to a sedan than an SUV.

 

In short, when looking for used cars, it’s best to focus on the type that appeals to you the most. Once this is established, then you can take several for test drives.

Effective Ways to Prepare for a car Loan

No matter how much you’ve loved your vehicle and how well it has served your needs over the years, the time will probably come when you’ll need to part ways with it. When you’re ready for an upgrade or change, there are some simple steps you can take to help ensure you can get a loan for your next vehicle.

 

Pay off Debt

 

It’s difficult to avoid debt, especially on large purchases such as homes, education and cars. When you want car loans, though, it’s important to get rid of obligations such as credit card debt and installment loans. If you can’t totally eliminate these debts, do your best to pay down the balances. This will free up cash and will show the finance team at the dealership that you have enough money to make your monthly payments.

 

Come With Cash

 

You may not have enough money in your pocket to pay for a car with cash, but if you can make a down payment, you’ll have a much better shot at qualifying for the loan you want. If possible, put a few thousand down. This will reduce your purchase price and monthly payments. It may also offset some of your debts or even poor credit.

 

Improve Your Score

 

The dealership finance team will review your credit history and credit score to determine whether you are a good candidate for car loans. If you have a poor score, you may not qualify, or you may get an unfavorable interest rate. Resolving some of your credit issues will go a long way to help get into the car you need.

 

Trade it In

 

Your current car may still have some value left in it. If it does, consider trading it and putting it toward your next purchase. This could augment your down payment.

 

You should take these steps seriously if you want to qualify for a loan. These tips will increase your buying power at the dealership.

The Main Advantages of Car Leasing

If you’re thinking about getting another vehicle but you have some concerns about paying for it in cash, car leasing is a feasible option offered to those looking to get a car without a costly down payment. It may be one of the easiest ways for you to get the car you want and need without spending too much of your money in the beginning.

 

The Down Payment is Affordable

 

If you’re going to lease a vehicle, you may have to make a down payment, but you won’t have to worry about that down payment costing you thousands of dollars. In fact, many people prefer leasing a vehicle because the down payment is so affordable. There are times when the company that leases that car doesn’t even charge a down payment, but that will likely depend on your current credit score and credit history.

 

You’ll Get to Drive a Car You Love

 

Not a fan of driving outdated vehicles? Most people aren’t. The great thing about choosing to lease a vehicle instead of purchasing it is that you’ll get to choose from such a broad selection of beautiful, recently released vehicles that are in fantastic condition. If you’re on a budget, driving your dream car may have been out of the question, but it’s something you can do if you’re leasing. You may be able to go to the dealership, check out all the updated options they have available, and then pull off the lot in a car you love.

 

If you’d like to drive around in an updated vehicle that is in fantastic condition both inside and outside, but you don’t want to pay the full price for it when you first get it, car leasing is an option you should consider. Leasing has its advantages, including low down payments and access to vehicles that may initially cost more than you could afford if you were paying in cash.

Purchasing a Car with Less than Perfect Credit

When it comes to borrowing money, credit is king. The importance of good credit is often emphasized when talking about lending options; whether it be a home mortgage or business loan, or more commonly a car loan. People may become discouraged if their credit is less than perfect, to the point of not even attempting to purchase a car with a loan. A good dealership can work with customers that have bad credit, and they often can provide people with bad credit car loans.

 

The Cosigner Option

 

One method by which a dealership can help someone with bad credit achieve a car loan is by providing a loan contingent on the involvement of a cosigner. A cosigner is a person with better credit than the main signer, or with more assets than the main signer of the loan contract. This person acts a guarantee to the lender that funds will be repaid in the event the main signer of the loan defaults. In this way the cosigner can be held responsible for the repayment of the car loan, giving the lender enough assurance to provide money to the car buyer with less than perfect credit.

 

Trade-ins and Large Down Payments

 

Another way for someone with poor credit to be approved for a car loan at the dealership is for them to trade in a vehicle towards the cost of their new purchase, or for them to provide a significant portion of the purchase price as an upfront cash payment. This method of car purchase limits the size of the loan and thus lessens the risk taken on by the lender. The smaller portion of the cost of the vehicle that is financed equates to more proclivity on the lenders behalf to release funds to someone with bad credit.

How You Can Get a Great Car Lease

You might be surprised to learn that car leasing follows a similar strategy to car buying. It’s all about being prepared before you go to the dealership. In particular, there are a few steps you can take to get a great car lease.

Know Your Prices

Do your homework before you walk into the dealership and know your prices. Not just the wholesale price of the car that you want, but the blue book value of your trade-in, if you have one. You could then negotiate an equitable lease rate and maximize the value of your trade-in.

Negotiate Options

A lease agreement has provisions for options such as down payment, mileage limit, and end-of-lease purchase. Prepare to negotiate the terms of these options with your dealership. Also, the amount of down payment affects your lease interest. A larger sum could reduce the interest rate.

End-of-Lease Terms

Make sure you know what is required when the lease expires and it’s time to return the car. For example, you might need to return the car with fairly new tires. Knowing the terms in advance, could help you to avoid penalties.

Avoid Mileage Overage

Check the mileage terms of the lease. If you anticipate driving over the allotted mileage, then you might want to consider purchasing extra miles at the beginning of your lease. If this sounds like something you’d consider, ask the dealership if you can do this.

 

Just like a car purchase, you might want to consider coming prepared to the dealership for a lease. Know the wholesale price of the lease vehicle and the blue book price of your trade-in. Familiarize yourself with your lease options and end-of-lease terms and if you anticipate logging a lot of mileage, consider adding extra miles to your lease plan.

Don’t Overpay on Your Car Loan

When it comes to purchasing a vehicle, there are many factors to consider. One of these factors is the price that you are going to pay for the car. Most people choose to go with some form of financing or types of car loans. If you happen to get a loan, it’s imperative that you don’t overpay on it. Here are three tips on how not to overpay.

 

Be Careful With Monthly Payments

 

When you negotiate your monthly payments, you don’t always want to go for the lowest possible rate. There is always interest attached to a loan, you want to make sure that you are paying enough that you won’t be accruing more interest over time. This could force you to pay more for the car than you would have with a higher payment plan.

 

Be Careful With Long-term Loans

 

Similarly to the tip above, long-term loans can often force you to pay more for the car than you would have otherwise. Long-term loans get more money out of you. As a dealership, we don’t want to see your interest build up. The sooner you have your loan paid off, the better it will be for your future finances.

 

Be Careful With Fees

 

Often, with any loan, especially financing for a car, there will be separate fees attached. When it comes to your monthly payments, pay close attention to these fees before you make any decisions. You need to make sure that the payments are below your budget. You also don’t want to pay more for something that you don’t need.

 

Whether you’re purchasing your first car or you’ve purchased in the past, these tips should help you to make informed decisions to keep from overpaying on your loan. One of the best parts of purchasing from a dealership is to get a good deal, it’s best that you can secure it.

Is Leasing a Car Right for You?

If you are ready to look for a new car, you might be considering car leasing as an alternative to buying. Leasing a car comes with a variety of benefits, but it’s important to understand the basics before you sign on the dotted line. We’d like to offer you some information about the ins and outs of leasing, and what you might want to know before visiting the dealership so you can decide whether it’s the right choice for you.

 

The Financial Aspects of Leasing

 

There are a few financial benefits to leasing a car, but before you jump into a deal, you may want to consider a few factors first. Car leasing usually means lower monthly payments, decreased tax fees and a small down payment, but you might consider if these will benefit your long-term budget needs. For example, if monthly payments are low but the lease includes a hefty drive-off fee, this may reduce your overall savings.

 

Consider Your Credit Status

 

Leasing a car can comes with plenty of perks, but it usually requires a good to excellent credit score to qualify. Of course, most dealerships have different requirements and you might be able to find affordable car leasing if your credit score is on the cusp between fair and good. It’s wise to order a copy of your credit report and pay off what you can before you try to obtain a car lease, as a higher score can yield better deals.

 

Read the Contract Carefully  

 

Before you sign a car lease, it’s a good idea to look over all the terms and conditions carefully and discuss anything that is not clear with your dealership. This can help you avoid fees that were overlooked at signing, such as those related to mileage caps and maintenance requirements.

 

Car leasing can help you save money on having access to a vehicle, but only if you understand the details of how it works. Being informed and planning your lease can result in big savings, no matter where you drive.

5 Tips to Help College Students Get a Car Loan

There’s a lot on your shoulders as a college student. You deal with everything from keeping your grades up to finding a job. At some point, having your own vehicle becomes necessary. The question you’re facing is how you will pay for it. If you’re strapped for cash, car loans make it possible for you to buy a quality automobile. There are a few tips that can help you secure financing.

 

  1. Build Credit

 

Good credit helps you obtain a loan with lower interest rates. When establishing your credit, don’t max out your credit limit. Pay your bills on time. Only apply for credit you actually need.

 

  1. Set a Budget

 

Figure out how much car you can afford. You can do this with an online finance calculator. It gives you an estimate of the loan cost and monthly payments.

 

  1. Shop Around

 

There are a variety of institutions offering car loans, such as car dealerships. In many cases, a dealer can qualify you for a loan even if you have no credit or bad credit. Shop around for the best interest rates.

 

  1. Get a Cosigner

 

You don’t have a credit history? Is your credit poor? Ask a family member or friend to cosign for the loan. The cosigner must have good credit. Going this route increases the likelihood of you being approved for financing.

 

  1. Offer a Down Payment

 

A sizeable down payment lowers your monthly installments. It makes it easier to pay off your car loan. Save as much money as you can. Consider borrowing money from a family member or friend, if necessary. The more you pay upfront, the better.

 

You don’t have to wait until you graduate college before getting a vehicle. By following the tips mentioned above, you have a good chance of qualifying for a car loan now. Before you know it, you’ll be driving around town in a top quality auto.

What to Expect When Going to a Dealership for Financing Assistance

Many Canadians who go to their dealerships for car loans or other financing help are doing so for the first time. As a result, they often feel nervous and may delay buying cars for longer than intended due to uncertainty. However, knowing what to expect in advance can make the process much more appealing.

 

Professionals Who’ll Listen to Details About Your Financial Situation

 

At our dealership, we help people from all walks of life buy cars they love. Regardless of if you come to us to start the process of getting approved for a loan, anticipate that you’ll speak to finance professionals who are ready and willing to hear all the details about your credit history, current budget and other relevant financial details.

 

An Explanation of All the Specifics You Need to Know

 

Car loans sometimes seem complicated to people who are not used to applying for them. While doing preliminary research about vehicle financing, you may have come across unfamiliar words and descriptions.

 

Rest assured that a dealership’s financing professionals take all the time required to ensure you understand the terms of your loan. The most important thing is that you’re able to pay back the amount loaned to you within a certain amount of time.

 

However, it’s impossible to make that commitment without knowing all the terms of your agreement and what they mean. Professionals who help their clients secure car loans are familiar with the industry lingo and put it into words that are easier for laypersons to grasp.

 

Courteous Behavior

 

The people who work in financing departments of dealerships also typically treat their clients with respect and make them feel at ease. Your financing experts should be approachable, patient and eager to explore all possible resources.

 

Now that you know what to expect when applying for car loans, you’re in a good position to consider using financing to get your next vehicle. Get in touch with us for help.