Securing loans to fund buying a new car while you’ve got negative credit is challenging. However, that doesn’t mean that when you have low credit, you can only finance your new car by paying cash. Currently, car buyers with poor credit have several options when it comes to funding their dream car. Is your bad credit making it difficult to secure loans for buying a car? The following are several financing options to consider.
Online Car Loan Providers
Online-based fintechs offer various loan products, auto loans included. The auto loan application takes place online, and most requirements are fulfilled online. The loan limits and interest rates differ from one provider to the other. By researching the internet, you’ll find dozens of auto loan providers, all of which claim to be trusted and experienced. The easy way to identify the ideal vehicle loan provider is by searching through online reviews and aggregation websites.
Credit Unions/Banks
Another car-funding solution for buyers with negative credits is getting a loan from banks and credit unions. These loans involve a banker to assess and pre-approve loans. Loans secured from a credit union or bank need to be paid every month for the given time-frame. It’s a good loan option if you’re an active member of the specific bank or credit union.
Captive Financing
If none of the financing options above suits your specific needs, consider captive financing. This type of car financing is offered by the auto manufacturer. It’s a great loan type because you get it directly from your dealership, meaning you won’t go through third-party pre-approval. This loan type is suited for everyone securing a new car regardless of how bad their credit rating is. Captive financing providers offer friendly loaning terms as well as various incentives to ease how car buyers secure loans.
Financing by Auto Dealership
If you have tried all the above financing options but have had no success, you can look for dealership-arranged funding options. Specific auto dealers offer these types of loan options. Do a thorough search to find the best dealers that offer these deals. By asking for financing options from more than one dealer, you will get to choose one that matches your car-financing needs. The auto dealer-arranged financing option is ideal for car buyers with fair or bad credit ratings, but the application process is lengthy and complicated. Depending on the dealer you select, you might have to wait several weeks for the loan to be approved.
These are the perfect financing solutions for you to consider if you plan to purchase a car with poor credit. These loans can be customized to the unique car purchase options of each car buyer. To get the best financing solution for your unique needs, you want to compare financing options from different providers. Settle for loans you’re comfortable paying so that you don’t default on the loan.
