The average consumer credit score is slowly ticking upward, but a study performed in August 2015 found that 12.5 percent of all borrowers still have a bad credit score of 550, or lower. Bad credit or not, most Americans still need a car to get to work and to run errands, but where can they turn to get a low-interest loan?
With a little research on your end, you can find a low-interest car loan, despite your bad credit.
Tips on Getting a Low-Interest Car Loan with Bad Credit
First, you will need to do some research and find the lowest interest rates for car loans that are available. This will give you a base to work from. Car loans designed for those with bad credit typically have a much higher interest rate than traditional loans. What’s more, there are even some lenders who will charge additional fees on top of their high interest. Remember to proceed with caution when you are seeking the ideal loan and never be afraid to walk away from a bad deal. Most importantly, always read the fine print to learn about any unnecessary fees.
If you belong to a credit union, you should first look into obtaining a low-interest car loan through them. No financial institution knows your finances better than your own credit union, and they generally offer very competitive finance rates and are willing to work with their customers. Going through your credit union may require certain special provisions, like having a CD or savings account with a fixed amount deposited in it, or having your payment auto drafted, but these are typically far more manageable than paying high interest rates.
Finding A Low-Interest Car Loan with Bad Credit
Thanks to the Internet, it has become easier to locate low-interest car loans for those with bad credit. The Internet is chock-full with lenders who are willing to give lower-interest car loans to buyers with damaged credit. When going this route, it is important to remain realistic with your expectations and realize that “low interest” is a relative term that varies greatly on your financial stability.
Here at CarsDirect.com, we can do the legwork for you too. CarsDirect Financing helps more credit-challenged customers find car loans than any other website in the country. We work with a network of dealers who specialize in car financing. They have access to a number of financial institutions and will shop around to find you the best deal. Just fill out a simple application and you may be on your way to receiving a car loan.
A Word of Caution
Keep in mind that it is ultimately up to you to find reputable, reliable lenders, to finance your next car, so be sure to do some checking before providing your personal information.