Bad economy benefited bad credit borrowers looking for auto loans, as banks and automakers are more lenient than ever. Today is the perfect time to get advantage of low-cost auto loans designed by online lenders specifically for bad credit borrowers.
When people with good credit say good-bye to their old car when they trade it in for a new vehicle at a dealership, people with bad credit say hello to their beat-up ride every time they pick it up from a repair station after performing costly repairs. People with bad credit continue blowing money on fixing their old cars, as they feel that auto loan for a newer ride is something they would not be able to get. While bad credit borrowers are not on the top priority list of banks and financing institutions once it comes to lending money, getting an auto loan is very feasible even with seriously damaged credit. All it takes is the knowledge of how automotive lending industry works.
Take Advantage Of Slow Economy
Once businesses and government finally acknowledged recession, it was announced who is to suffer most. Guess what banks and automakers topped the list! Banks suffered from inflated mortgages, and automakers were hit with slow vehicle sales. Both of these factors combined offer a great advantage to bad credit borrowers looking to finance their next vehicle purchase. Banks are looking for high-yielding investments outside of real estate, and car manufacturers scratch their heads trying to move their inventory. That is exactly why auto loans are easier to obtain than before, as lending institutions are offering less stringent requirements as car makers feed them with significant incentives. Therefore, if yesterday you were declined, today you may be surprised to be easily approved for a car loan.
Stay Away From Dealer Financing
Most dealers try to finance car shoppers either in-house, as buy-here, pay-here dealers do, or through a network of loyal lenders. In both cases, once they find out that you have bad credit, they would require a huge down payment and hit you with an inflated interest rate. While you may get excited with loan approval, once you take a cold, objective look at the offer, your excitement would turn into a disappointment. In many cases, such financing offers are bordering with scams, as paying them off is a true nightmare.
Look For Lenders Online
The rule of traditional banks and financing corporations is over, as online lending is getting more and more popular. Online lenders have lower overhead costs, and are able to make an extra step towards bad credit borrowers by approving applications that others reject. In addition, they offer efficient and user-friendly application processing. Borrowers are able to get pre-approved for an auto loan in as little as 60 seconds by filling out a short application. Online auto loan shopping also saves tons of time, as there is no longer need for going from one bank to another, looking to get a loan.
More intense competition, resulting in ease of access to lending resources, also benefited borrowers with bad credit, as they are able to compare lender offers online, and only take the ones that are most attractive in terms of interest rates and lender charges. Therefore, if you are looking to get a bad credit auto loan, online lending is perfect for you. In fact, you may drive your new car off the dealer lot in a matter of a day or two, hassle-free.