Getting a Car Loan on Bad Credit | Yes Loans
Get the answers you’ve been looking for and find out how you can get your car
Bad credit. Those two words can send a chill down anyone’s spine, and those that have it can feel like they’re being followed by a dark cloud of disappointment. Bad credit is often the result of youthful inexperience or unbridled enthusiasm, but does it mean you now can’t apply for a car loan? Surprisingly not. It’s not a reflection of your character or work ethic, and most certainly not a death sentence. You can get a car loan and thankfully there isn’t a catch either.
Before you dash out the front door in a blur, here are some things to mull over before looking for vehicle finance:
What wheels are you after
Be brutally honest with yourself and distinguish what you need versus what you want. Needs address the lifestyle you have; wants address the lifestyle you want. Being able to define the lifestyle you lead and the requirements you have will make it that much easier to pigeonhole the type of car to get, and save you spending unnecessarily.
Budgets are usually the bane of our existence. But just like our parental advice, budgets are there to provide some much-needed guidance; and like our parent’s wise words, you might ignore them and regret it later. Draw up your monthly budget so you can clearly see what you can afford. A car does come with its own list of expenses including servicing, insurance and fuel. It’s easy to forget these things during the excitement of purchasing.
Compare and window shop
Before you begin car shopping and visiting dealerships, call Yes Loans to get a pre-approval. The type and age of car can have a big impact on any approval. The newer the car, the better your chances of gaining approval.
Right! Now to secure the finance. Read on to find out how you can get your car loan, despite carrying the so-called burden of bad credit.
Don’t jump the gun, verify first
A credit score is essentially used to help determine whether a borrower is likely to pay back a loan. It is determined by your payment history and should ideally be reviewed at least once a year.
However, mistakes do happen, so it’s critical that you review your credit report and check for inconsistencies. You might find that you no longer have a bad credit score or were incorrectly assigned one in the first place.
A consumer loan, also known as a secured personal loan, uses the car as collateral and is what most people think of when they think of consumer loans.
A chattel mortgage is a loan for self-employed people, contractors, and large and small businesses to secure a loan against a vehicle or machinery plant and equipment.
Commercial hire purchase
A commercial car hire purchase is a method of vehicle financing. A lender buys a vehicle for a customer and then grants the client use and custody of the motor vehicle on a contractually stated payment plan.
A novated lease is commonly used by employers and employees. It provides an alternative arrangement to the standard company car, allowing the employee to take on the responsibility and control of the lease, and associated benefits. The monthly rental payments are made by the employer out of pre-tax salary.
Helpful hints to get your bad credit back on track
• Consistently pay your bills on time.
• Pay towards reducing your debt.
• Don’t open a new line of credit, like a credit card or home equity loan.
• Maintain a solid employment history.
• Don’t make multiple applications for loans.
• Don’t apply for “pay day lender” small, short term loans. Most financiers look at this as a borrower not being able to manage their finances and is often grounds for a decline.
If you've had credit problems in the past, it shouldn’t mean that you can no longer enjoy what life has to offer in the future. Make sure to consult a professional like Yes Loans with a wealth of knowledge and a transparent approach, someone who will still strive to get you the finance you need, at the best rate possible.
Yes Loans do just that, they also provide a range of free services, like car finder and a car loan calculator.
At Yes Loans our philosophy is simple: We aim to provide a fast and efficient service to our clients and enable them to make informed choices in relation to their finance needs. If you need a car loan, contact ustoday. We’re happy to assist.