It is true that not everyone can get approved for an auto loan, but most people need a car just the same. That is why there are so many non-traditional lenders now that provide bad credit auto loans for people in just your situation. If you have never taken out a bad credit auto loan, here is what you can generally expect.
High Interest Rates
Yes, it is true that bad credit auto loans carry higher interest rates. However, the lenders are taking a very big risk on you by lending you the money you need to buy a car. Plus, they are doing so much more than other lenders to give you that loan that the higher interest rates are worth it just to get a car. Perhaps you can view this another way; after several months of consistent payments, your interest will drop a little, and you will be improving your credit. Those added benefits are worth the rates.
Unusual Repayment Plans
Traditional lenders expect you to repay your loans on the exact same date every month and to pay the loans monthly. Bad credit lenders provide more unusual, albeit more flexible, repayment plans. Some will offer you a weekly plan, where you pay on the same day every week. Others will offer a bi-weekly or semi-monthly plan. This can help you repay the loan based on how often you are paid and when you have money available during the month to make a payment.
Loyal Customer Rewards
Bad credit lenders often have loyal customer rewards programs. This sounds strange, considering that there is not much these lenders could give you that would make you loyal. However, the rewards are in the form of new loans with lower rates and the ability to refinance or rewrite the terms of any of your current loans. Such perks are most helpful in the event that you have need of yet another vehicle, or the one you are still paying off is no longer functional or usable.
Where You Can Apply for These Loans
Most of the time, car dealerships have partnered up with bad credit lenders in order to provide everyone with the opportunity to purchase a car on the lot and drive off with it on the same day. The bad credit lender shares office space with the dealership. Otherwise, the dealership works with an online bad credit lender to get you a loan.
It is never easy to think about investing boatloads of money into a new vehicle, but a few years ago, I found myself doing just that. I had dealt with a dying car for so long that it was hard for me to imagine having a car that worked well, but before I knew it, things were really coming together. I was able to work with a friend of mine to find a vehicle that worked just as well as it said it did, and to make matters even better, it held its value well. This website is all about getting the price of a car down when you want to buy one.