Now the car is one of the essential things for everyday life and when you going to buy the new car, you must avail the car loan. But financial institutes cannot approve car loan with a bad credit score. If you have a bad credit score then you may face some difficulties to avail the car loan. In this regards you can consult with some financial advisors who can help you to improve your credit score and you will get the car loan easily. If you are living under pressure due to poor credit score, it is extremely difficult for you to buy a vehicle. But don’t worry every problem has a solution and there is solution to this issue of yours also. There are various tips that will help you to find the right company for accomplishing the task. A border line credit score will definitely make some lenders interested in your financial profile and will fulfill your requirement of loan.
Why the bad credit score should be avoided?
In some cases it has been noticed that people do not get the car loan for their bad credit score but they can easily afford the loan amount. So for these instances, the loan companies should incorporate few things like the status of job and employability, affordability and the debit capacity when loan companies are contacted.
- The employability means the job of the applicant should be secure and permanent. The applicant should be a full time employee of the company.
- The bank statement should be clear and there must be no lack of payment or financial penalty.
- The most important thing is whether the applicant shall be able to repay the loan or not? So in this regards the debit-to-income ratio should be verified.
- Debit-income ratio means calculation of the excess income. All liabilities and existing loan amount should be deducted from the monthly income, and then the rest amount shall be treated as an excess amount. If this excess amount can match with the car loan EMI then the applicant can avail the car loan easily.
How do you find the best loan deal?
If you have a bad credit score then you can avail the car loan from various companies. There are mainly three types of car loan companies available, firstly you can approach the bank, secondly you can avail the loan from the car dealer directly, and thirdly you can search for some online loan consultant.
- If the bank approves your loan then it is the safest and the most secure process. But most banks charge higher rate of interest for bad credit score because of their security. So in that case you can opt for the loan from some other financial consultants at a low rate of interest.
- Auto dealers offer finance options at the highest rate of interest and they charge additional and hidden chares as processing, penalty, and late payment and prepayment issues.
- The online loan lenders can offer various types of car loans. You can compare the rate of interest and select the company accordingly. Apart from that they do not charge any additional amount for your bad credit score and they offer long time tenure, so that you can pay low monthly repayment amount.
The possibility of low rate of interest car loan for bad credit customers:
The above mentioned steps will be highly beneficial to attract beautiful offers which help them to get car loan with bad credit. Sometimes, the banks might understand the reason for the bad score and provide suggestions on how to avail the loan at lower interest rates. There are instances when the employers or the insurance company hired by the customers may offer auto loan options. Rather than relying on the third party lenders, locate the prominent international and the local banks to get the quotations. Generally the small financial companies deal with those customers who have extremely low credit score. Therefore, the possibility of getting loans under better conditions is extremely remote.
