All About Car Loans  

In modern society, an automobile and car loans is an important investment. Without one, an individual has fewer options for employment. Since cars are so expensive, most consumers require financing when making an automobile purchase. These car loans are vital credit products for working people that need reliable transportation.

However, it is important for people to understand the specific differences between credit products. While car loans can be helpful, they represent a commitment to pay a significant amount of money over a long period of time. In addition, specific terms govern the way in which the debt must be retired. Savvy consumers must understand the differences between types of car loans. For example, specific financial arrangements are often provided for individuals with poor credit.

What to Expect When Pursuing a Car Loan

How to Get a Car Loan When You Have Bad Credit

Exercise Caution

Car Loans Rates and the Length of the Loan

How long you finance your car will affect your car loan rate.  Most lenders or car dealers will charge a higher interest rate the longer the life of the loan.  The shorter time you finance a car the better.  Your car will be paid off sooner, you will pay less in finance charges and you will run less of a chance of having a reverse equity on the car.  Reverse equity you owe more on the car then the car is worth.

The Percentage Rate on the Car Loan Rates

Car Loan Rates and FICO Score

Online Car Loans

The process for getting an online car loan is similar to the process for getting a loan at your neighborhood bank branch or a car dealership. If you have good credit and a secure income you can get an online loan approved in minutes. If you have less than perfect credit or have changed jobs recently an online loan approval may take more time to arrange. The advantage of an online application is you can apply for your loan at a time convenient for you from your home.
The Federal Trade Commission offers tips to ensure your online financial information is secure.

1. Use a secure browser that encrypts or scrambles the information you send online.
2. Check the privacy policy of the lenders site you are applying on. Make sure the policy states they will not share your information with others and that they ensure the security of the information you submit.

Choose the lenders with a reputation for fair dealings and competitive rates. If you know you have some credit history problems look for a lender that specializes in subprime or bad credit loans. Most lenders will not charge a fee to review your loan application. It is usually a good idea to apply for a loan with more than one lender so you have the opportunity to compare the loan terms offered by the lenders.
Before you start the online application process gather the documentation you will need to complete the application. For example, you will be asked when you complete an online car loan application for details about your current address (if you have lived at your current address a short period of time you may also have to provide your prior address, your employment history and present employment including your current salary, other sources of income like child support and for personal references. If you have already chosen a car you may be asked for the cars VIN number.
You may be asked to mail the online lender additional documents such as a recent pay stub (if you are self employed the lender may want copies of your most recent tax returns), a copy of your drivers license and proof of  your automobile insurance.
Many car buyers like to apply for a car loan before they have chosen a car so they have a good idea of how much they can afford to pay for a car. It is optimal if you can put a 20% down payment on the car. A 20% down payment will help ensure you get the most favorable interest rates for your credit history. You can finance a car with a smaller down payment but you will likely pay a higher interest rate and since you are barrowing more you will pay a lot more in interest over the life of the loan.

Want to know about car loans, bad credit car loans? Stay tune for our series of videos.  We will have pdf to go with the videos for a quick reference or you can print it out and take more notes.

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Who we are - Car Credit Facts

You can get a car loan if you have good credit, bad credit and no credit.  We have an online easy application to get you going.  There is no obligation.  There are 100's of dealers in this network as well as lenders.  These dealers and lenders also deal with bad credit.  If you have been turned down you may not have been dealing with a car dealer or a lender who specializes in bad credit car loans.

FICO Score

there are levels of FICO scores that lenders and insurance group people into.  It depends where you fal in this scale that will determine the interest rate you will pay or the insurance premiums you pay.

Bad Credit         300 - 619

Fair Credit         620 - 699

Good Credit      700 - 759

Excellent Credit 760 - 850

Interest Rates

Interest rates and what is the % you will be paying you want an APR and find a loan calculator to figure out how much you will have to pay back in interest (anoher video)

Length of payment - Know how long you pay on that loan is it 3 year, 5 years you do not want discover down the rad that you will be paying on that nice 1972 dodge dart for 7 years.

Payment amount - what is the total amount that you will be paying back.  If you budget $12,000.00 for a vehicle paying $17,000.00 could set you back.

Early payment penalties - just make sure there are no early payment pentalties for paying off the loan early.  You may want to upgrade that 1972 dodge dart to a nice Porchse Cynan when you have the finances.

No all the other fees associated with that loan and car purchase.

Payment and FICO score

Know the total amount you can afford - if you want to allocate $12,000.00 for a vehicle then make sure all the numbers add up to $12,000.00 and not say $17,000.00

Know the monthly payments you can handle.  You may only want to pay for 3 years but perhaps you go to $13,000.00 and it is still within your budget you are just going to put your bundgy jumping trip t New Zealand on hold for a bit to pay for the car. You may need to go to a longer term say 4 years to keep the payments in the range you can afford.

FICO score.  know you FICO score before you go to the dealer or apply for a car loan.  Knowledge is power.  We will be talking at length about FICO score, credit and how to improve your credit and maintain good credit

FICO score affects your interest rates

Interest rates affect your payment

Check list for buying a used car.  What you should look over on the used car you want to purchase.

Bad Credit Car Loans

Is your credit score of less than 620? If so you are what lenders call a subprime borrower. A subprime borrower is a borrower who lenders believe pose a higher risk than a borrower with a higher credit score. Subprime borrowers can still get car loans you just have to be a little more persistent and willing to pay a higher interest rate than prime borrowers.

Getting A Car Loan At The Best Rate

Auto Loans - Fast Approvals, Competitive Rates
Auto Credit Express?, online auto loans for people with special circumstances.

What can you do as a subprime borrower do to get the best car loan possible? First you need to obtain your credit reports and review them for accuracy. There are three independent credit bureaus, TransUnion, Experian and Equifax. Federal law requires the three bureaus to provide you with one free credit report from each credit bureau once a year.  You can get your credit report with a score here.  You need to have your score.  Your credit score does vary some so don't worry if your score is a little different then what a lender is saying you have.  If your FICO credit score is off a lot then you know there is something not right.

You can obtain your free credit reports online at each of the credit bureaus websites. Once you obtain the three credit reports review them carefully to make sure they are accurate. If you find information on one or more of the credit bureau reports which is not correct contact the credit bureau and ask that the inaccurate information be corrected. Be persistent and keep working with the credit bureau until the misinformation is corrected. You will likely be asked to provide documentation of the correct information.  This is one of the first steps in getting your credit on the right track.  Do not dispute everything on the report if you do not have the documentation on file.  They will not take your claims seriously if you dispute everything and you have no documentation.

How Much Of A Down Payment Do You Need For Your Auto Loan

You also need to start putting aside money for a down payment on the car you want to purchase. A 20% or higher down payment will help to get you a better interest rate on your auto loan even if you have bad credit. You will also benefit from a higher down payment because you will need to barrow less which in the long run could lower your monthly payments or shorten the length of your loan and cost you less in interest.

Finding A Lender For Your Car Loan When You Have Bad Credit

Now you are ready to contact potential lenders. Always get more than one quote so you can compare interest rates and loan terms and requirements to determine which loan is the best for your unique situation. Interest rates are important but so are the length of the loan and any other penalties or fees the different lenders may assess.
For example, ask about prepayment penalties. If you are able to secure a better loan in a year or two or if you sell the car before the loan is paid off you do not want to be assessed a prepayment penalty for paying off the loan ahead of time. Some lenders will give you a better interest rate if you authorize automatic deductions from your checking or savings account for the monthly payments. Some lenders will give you a better interest rate if you have a cosigner for your loan.
Always start with the financial institution where you do your banking currently. Many financial institutions are willing to work with current customers even those with a less than perfect credit history. There are many lenders online who specialize in subprime loans.  The subprime lenders web pages usually provide online loan applications. Just search for bad credit lenders to find the lenders most likely to consider your car loan application.  The car dealership may have the best loan package for you.  If it is a dealership that specializes in bad credit, and not all do, then they can work with you to get you an auto loan.

Buying a used car can be a great experience

When you are at the dealership

• Take your time when going through the features of the car.    

• Test drives should be performed on varying roads and at varying speeds. Its important to see how your auto responds in most conditions.

• It is good to see the auto during the day or have the vehicle pulled into a lighted area like the service department for closer inspection.   
  

Exterior Inspection

• Does the paint look rippled anywhere?

• Do the fenders and the doors align properly?    

• The seems on the closed hood and trunk are all smooth and look evenly spaced?