There could be a number of reasons why you have bad credit – from missing payments or defaulting on previous loans, to not having any history of using credit. If you’re looking to get a bad credit car loan, you might be feeling anxious about getting your loan over the line and approved by a lender.
Don’t panic – there are lots of ways you can get a bad credit car loan over the line and there are many lenders out there who work specifically with people who have bad credit. Finding the right lender is key and you’ll be able to speak with people who understand your situation and want to help you get on the road faster
Check your credit record
You can check your credit score for free so it’s useful to do this before you start any car loan application. Knowing what’s on your credit record will be really helpful as you can quickly see if there are any mistakes or inaccuracies. If this is the case, you can get these amended and you may be able to get a better rate of interest and lower fees on your car loan.
Time your bad credit car loan application
We understand that it’s tempting to submit your bad credit car loan application the minute you’ve finished it. You want to get on the road and you need that dream vehicle to do so. Take a moment though – it’s useful to think about whether you’re in the best financial situation possible. If you’ve just left a job or currently have no proof of address, you may need to wait a few months and time your application for when things are back on track.
Find the right lender
This is something that will really help to get your bad credit car loan approved. Often banks and bigger lenders have set criteria for approval of car loans and if you have bad credit, they’ll simply say no. By going to a company who specialise in bad credit car loans, you’ll immediately be speaking to people who understand your situation and can direct you to the right lenders for you.
Show evidence of financial success
You may have bad credit currently but think about what you can offer to reassure the lender that you are doing things right and getting on track with your finances. If you can show evidence of making regular repayments or offer bank statements which show you regularly paying your rent on time and in full, this could help lenders see you as less high risk to lend to.
Offer a Deposit
If you have bad credit history yet are currently in a good financial position, you might be able to offer a larger deposit than other borrowers. Lenders will look favourably on this as it offers some security so always try and put down the biggest deposit you can without straining yourself financially. Full details of your deposit should go on your bad credit car loan application.
It might sound basic but many people trying to get a bad credit car loan simply aren’t prepared and don’t have the documents needed. This can really slow down the process and won’t put you in the good books with lenders. Always make sure you have documents such as photographic ID, proof of residency and address as well as bank statements and proof of insurance. Being prepared will really pay off.
Article provided by Loans for People With Bad Credit