#auto loan for bad credit
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New Car Loans, Used Car Loans and Car Refinance Loans
Few people can manage their daily responsibilities without the use of a vehicle. Whether you need a car to commute to work or to school, the prospect of purchasing a new or used car is an exciting experience. Most importantly having your own transportation means freedom to go and come as you please without constantly rely on external schedules.
Mistakes to avoid when getting a car loan financed
In their haste to get a car, most people make the mistake of using an auto dealership’s financing or they fail to shop for a low interest rate car loan. The fact is, car loan interest rates can vary extensively depending on which bank finances the car loan. One car loan customer may get a car loan at a 6% interest rate, while another person with gets an interest rate of 7%. Over the lifetime of a car loan, a high interest car loan amounts to thousands of dollars that the customer could have used towards some other personal expense.
How Credit Scores Affect Auto Loan Interest Rates
You may have heard the term FICO score or credit score. Your credit score is a number from 300 to 850, with 850 being the best score that one can have. If your FICO credit score is above 650, you are generally considered to have good credit. If you need to buy a car and your credit score is below 650, you can still get a car loan.
Auto loans unlike home loans are easier to acquire because customers are usually financing a smaller dollar amount. This means that even customers with credit scores of 450, 500, 550, 560, 580, 600, 620, etc can get auto loans. Auto loans are also available to students or people who have no credit history. To compensate for the risk factor, auto loan lenders will charge a higher interest rate for people with low credit scores or no credit history.
Credit score qualifications
All credit scores considered: 400, 420, 425, 430, 450, 460, 470, 480, 490, 500, 510, 520, 525, 530, 540, 550, 560, 570, 580, 600, 610, 620, 630, 640 & up