Need a car loan but you’ve got bad credit? Don’t worry! It’s a lot simpler than you think to get bad credit car loans, it only takes a few steps with C1 Car Loans.
Read more below to find out how you apply today.
Got A Bad Credit Rating But Need A Bar Loan?
Tired of car loan brokers who don’t understand car finance? Most lenders turn away potential clients if they have a bad credit score or poor credit rating.
Luckily, there are financing options available for people who haven’t got a good financial history.
However, to get a bad credit car loan from a legitimate lender with an Australian credit licence, they will still need to perform a credit check.
A credit check is standard protocol and will be used to assess your payment history and current financial situation.
To qualify for a personal loan to buy a new or used car, bad credit lenders will first need to check a borrower’s credit history, which they obtain from a credit-reporting agency.
This helps the credit provider make a calculated assessment as to whether your car loan applications should be granted. They assess your loan repayment history, credit card statements, credit defaults, and your current financial position.
Lenders also use individuals’ credit histories to justify granting or denying a loan application. Many people don’t have a good credit history and haven’t done too well at making timely repayments on loans.
How Do Bad Credit Car Loans Work?
Now that we’ve established that getting a bad credit car loan is possible, even with a poor credit history, let’s see how they work.
Applying for bad credit loans is relatively simple. You can apply online for a bad credit car loan and compare multiple lenders’ quotes to see which deal suits you best.
Some deals may look better than those from other lenders but there are some key points you need to research.
Firstly, loan establishment fees are important to consider, especially for individuals who have a bad credit history and can’t afford to be paying excess fees
Next, when applying for car loans you need to confirm how much the monthly repayments will be. Utilise the car loan calculator and compare it to the usual market interest rate.
Interest rates will differ according to the duration of time you agree to pay back the loan, loan account keeping fees also need to be considered.
Check whether the lender offers lower early repayment fees on a secured car loan. This could benefit you if you’re in a position to pay earlier, even after purchasing your new car.
Repayment Terms On Car Loans
Being able to secure finance for a car is wonderful but there are multiple things you need to consider.
Specialist lenders need to liaise with car dealers to ultimately pay for the vehicle being purchased. This is similar to the principle of personal loans or a traditional bank loan.
- The main difference is that a bank or financial institution doesn’t typically approve loans if your bank statements reflect a bad credit history or if you don’t have a minimum required amount in your bank account.
- Your credit score, credit report, credit file, and whether you’ve been refused credit are important to a traditional lender like a bank. But, not so important for bad credit car loan lenders.
- With that being said they both will review whether you’ve ever skipped payment on your credit card, declaring bankruptcy in essence. A credit check ensures lenders that they will receive the money-back that they expect.
Important Tips When Taking Out Bad Credit Car Loans
- Do not max out your credit limits when you have an obligation to pay off a loan amount.
- Checkered credit history isn’t important if you’re a consistent payer.
- The interest rate changes according to the duration of the repayment terms.
- It’s advised that you get car insurance which will cover you if the vehicle is stolen.
- You’re legally required to adhere to the debt agreement per the part ix debt agreement.
- Qualifying for a specialist car loan usually requires lenders to credit check car loans you might’ve previously had.
- Compare usual market rates for cars before signing off with a lender.
- Before you access finance take note of the interest rates on car loan repayments.
- Enquire about benefit payments to ensure cost savings whenever possible.
- A car loan is a big responsibility and you need to understand all the terms and conditions clearly.
Getting a bad credit car loan is easier than most people think. However, it’s a big commitment, and individuals are advised to research accordingly. Finding the car of your dreams is possible with C1 Car Loans.