Bad Credit Auto Loans Pros And Cons

Getting financed for a new car can be an issue if you have a less than stellar credit score. However, it is not impossible for you to get the loan that you need to purchase safe and reliable transportation. As an educated borrower, you should learn a little bit about bad credit auto loans before driving out to the nearest dealership.

Pro: You Can Get A Loan On A Great Used Car

You don't have to sacrifice quality just because of you want to buy a car with bad credit. While you may not be able to buy a brand new luxury car, you should be able to buy a late model vehicle that will allow you to ride in comfort wherever you need to go.

Con: You May Pay A Higher Interest Rate

Borrowers who have lower credit scores tend to pay higher interest rates. The good news is that you will still find a loan with an interest rate that you can afford. An average rate for someone with poor credit is about 6 or 7 percent. If you have a cosigner, you may be able to get a car loan for a lower rate.

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Pro: You Have A Wide Selection Of Lenders

There will be no shortage of lenders who want to work with you. This will work to your advantage because you can wait until you find loan terms that fit your budget. Additionally, you will receive offers within hours instead of waiting days to find out if you have been approved.

Con: There May Be A Down Payment Required

Although you are typically guaranteed approval for a loan, a small down payment may be required. However, this lowers the amount that you need to borrow. In general, smaller loans are paid off faster while also lowering your interest rate. Overall, putting down money may be something that you want to do even if it is not mandatory to get approval for a loan.

There is nothing better than getting approved for a car loan. It means that you are able to drive in comfort and safety whenever you leave your house. If you need a loan for a new car today, get in touch with our network of lenders to find a deal that works for you with a simple online application.