Why Get A Bad Credit Car Loan Now?
No one should be discriminated against in getting a car
America is fascinated by cars and owning one gives great pleasure. To buy a car today, car loans are a pre-requisite. But for the borrower with bad credit, a car loan seems like a distant dream. Do you have a bad credit score? Are you having a hard time getting a car loan? Are lenders constantly turning down your vehicle loan application?
Well, if the answer is yes to all the questions, this article can help you get a car loan even with bad credit. In fact, after reading this text, you will understand why this is the best time to get a bad credit car loan to buy the car of your dreams.
That’s why getting a bad credit car loan is easier than you think
A boom in car sales
7.3 million – This is the total number of cars sold in the first half of 2012! There is a 14.8% growth in car sales since last year. This sale can be attributed to many factors such as car manufacturers pushing for car sales. Even European car manufacturers consider the US market profitable. They are struggling for higher sales in America because of problems in their economy. With this new development, you can get newer car models and better incentive programs. In addition, the easy flow of credit played an important role.
Lowest delinquency rates
The delinquency rate is the percentage of auto loans that have not been paid by borrowers. TransUnion, in its first quarterly report for 2012, mentioned that auto loan delinquencies fell to 0.36%, down from 0.46% in the fourth quarter of 2011. These numbers proved that borrowers are more serious and diligent in making regular payments.
TransUnion also mentioned that there is growth in lending as well as leasing in the subprime risk segment. With low delinquency rates, lenders can put more faith in the equation. They already understood that people will certainly make payments. When the general mood is positive, getting a bad credit car loan becomes easier.
Investor confidence
Investors buy securities made up of auto loans because they are relatively safe and profitable. They perform better than home loans because cars are a major requirement for us. We can give our home, but the car is necessary for our work. This makes them a safe bet. A recent example of this is how companies such as GM Financial, Santander Consumer USA and other lenders have issued $10 billion in ABS linked to subprime auto loans. That’s a 20% jump over last year.
This deal proves that car lenders will now offer worse car finance options as it has become a lucrative option for them. They can easily bundle your loan as securities and profit from it. So, car finance companies are now taking risks by offering high quality car loans.
All these factors lead to one conclusion that lenders are now interested in providing you with bad credit car financing. It is no longer difficult to secure credit. It is no longer difficult to buy your dream car!
Are you READY for a bad credit car loan?
Before you get a car loan for people with bad credit, you should keep these important points in mind so you don’t doubt your decision later.
1. It is important to choose a cheap but efficient car. A used car is the most affordable option for you. It is a perfect choice as its depreciation rate is lower than that of new cars. When choosing a car, be sure to check its name. Have it inspected by your trusted mechanic.
2. If this is your first loan after your score has dropped, you should be prepared to pay a higher interest rate.
3. Choose a shorter car loan term so you don’t increase the chance of a reverse car loan.
4. Regular payments are absolutely necessary to improve your credit score and avoid further deterioration. If you make your payments on time, you’ll get better interest rates next time.
5. Most lenders have a lockout period during which you cannot refinance or trade in your car. This is usually the first six months or the first year of the loan term. So, don’t choose a car loan that makes you feel uncomfortable because you will be stuck with it for a while. Take the time to analyze and choose a bad credit car loan offer.
These important signs are very important to reach a good decision. You should understand that bad credit car loans are easily available, but you can make them more convenient by remembering these points.
Now that you know how easy it is to get a bad credit car loan, don’t wait any longer. After considering all the points mentioned in the above paragraph, you should start the journey of restoring your good old credit.
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