Are you buying a car with a bad credit record? It must be challenging, especially that you have to convince a dealership to finance your loan. Obviously, you have to plan it right.
Here are ways to make slow, calculated moves toward getting that auto loan approval in Arkansas at a reasonable rate, Malco Motors advises.
Need vs. Want
First of all, ask how badly you need the car. While this need obviously is real, can it wait for at least one to two months? You can improve your credit score by paying your existing loans on time within that time. Remember your payment history takes up 35 percent of your total score. If you start paying your overdue bills on time, it can be beneficial to your score.
If it can't wait, it's time to shop for potential car lenders in your area. Compare loan terms based on your credit score. Make sure to check different lending firms and bring with you the published rates when you meet with them.
Do ask if the negative item in your card has a bearing on the given loan rate. Then, request if they can help you work around it. Some dealerships may not "hold it against you" if they find your reason good enough.
Decisions that Make a Difference
Once you have found the right lender, consider opting for the following
- Shorter terms over longer ones. If you can pay a slightly higher rate for a shorter time, go for it.
- Buy newer cars than older ones. Auto lending firms find these items better for financing while older units are opted to be sold for cash.
- Don't get add-ons. With your credit score, you need not extra costs that come with auto loan terms.
The urgency of your need is given, but it will not be your best card to win a financer's approval. More importantly, you should not make it the reason for lenders to take advantage of you. Give car dealerships a two-week interval to ask for your credit score. That way, it will be counted as a one-time inquiry even if the requests come from different lenders.