Bad Credit Auto Loans: Preparing Yourself For The Best Deal
Bad Credit Car Loans. How To Prepare Yourself Before Visiting The Dealership In Order To Get A Good Deal!
Searching for a decent used car is hard enough, but if you are looking for a bad credit auto loan on top of that it can become a daunting task! Usually its pretty easy to spot a good deal at a local car lot. Just make sure that if you are financing the car and you have a few credit blemishes that they don’t try and sneak in a few extras that you really do not need. These types of tricky tactics are how dealers get you to spend more money than you actually need to spend.
Having bad or no credit can be a very discouraging when your dealer comes back to you with an extremely high interest rate on your car loan. It sort of makes you believe that there is no way you can get a good deal on an auto loan if you have credit problems.
At times this can be the case but one thing to remember is that car dealers need to sell cars. Don’t be afraid to walk away and try your chances at another dealer if you feel you are not getting a good deal. The message I will try and get across to most readers of this article is what to do to prepare yourself to get a good deal when shopping for a bad credit car loan.
First things first… Know Your Credit Score Before going to the car dealership! If you have a good idea of how bad your credit really is before entering the dealership, you will have a lot more of the upper hand when trying to make a deal. Usually what people do is go to a car dealers lot, find the car of their dreams and then speak to a car salesman about the purchase of that particular used car. Usually when you do this, and you find out afterwards that you don’t qualify for a good credit auto loan, the dealer then has the opportunity to take advantage of you by possibly overcharging you on the loan, knowing that you love that car and you will probably take the deal anyway. This in the long run can cost you a ton of extra expense that you didn’t really need.
Your initial step should be to go and search for a service that offers all three credit reports with FICO scores. You can find literally thousands of these services online by searching for them in Google, Yahoo and MNS Now known as BING. The three credit bureaus mainly used by lenders are Equifax, Trans-Union and Experian. You can also request a copy of a free credit report from all three agencies once a year, without impacting your credit score.
Lenders use the FICO score as one of the single most important factors for determining credit worthiness. Credit scores usually range from 400 to 900 with anything over 700 being considered as good credit. If you walk into a dealership saying you have bad credit and they run your report and see that you have a 690 credit score, the dealer may consider offering you a higher interest rate simply because you thought your credit history was extremely bad, when in essence it was better than you expected. You must remember that car dealerships have to make a certain amount of money on every car they sell because they have a very large overhead. So it is expected that they try and charge you more when they can. That is just how this kind of business works. But I am a true believer that a deal has to be fair for the dealership as well as the customer. I feel that no one should be taken advantage of!
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