How to Raise your Credit Score
by Steve Cypher on Saturday, July 31st, 2010If your credit score has fallen victim to the current economy you may find that one credit repair method to improve it and reestablish your auto credit is a second chance car loan
How you got where you are now
If the current economy has resulted in a personal event such as a change in employment, unexpectedly large medical bills or if you’ve gone through a divorce or experienced legal troubles and one of these events has turned what was once a good credit score into a bad credit score, you need to know that there is a way you can regain that good FICO score.
Even in these challenging times, those of us here at Auto Credit Express want you to know that there are lenders out there that are willing to help consumers who, at one time, had a good credit score and now have bad credit – especially if the lender can identify a single economic event that caused your formerly good credit rating to drop.
When someone’s credit turns from good to bad, they can end up losing their vehicle, either through bankruptcy proceedings or repossession. If this ever happens to you, you may find yourself, after much trial and error (although hopefully not too much), getting a bad credit auto loan through a subprime auto lender.
Improving your credit score
Getting a bad credit car loan after an unfortunate credit experience provides an excellent opportunity to raise your credit scores. As you go through the process of purchasing a car, here are some things to consider:
• The first loan following a severe drop in your credit score will be at a higher (sometimes much higher) interest rate than you may be used to.
• In the future, you will qualify for a better rate provided that you make the payments on time on your first bad credit car loan.
• Due to negative equity, you may not be able to refinance, or trade in your vehicle until at least half the loan term has been reached (for example, 30 months into a 60 month loan).
• If you don’t make your payments on time with auto loans for bad credit, your credit score will drop even further.
The finer points of car loans with bad credit
Before you buy a car after a bad credit experience, you will have to decide what is most important to you. If re-establishing your credit as quickly as possible is your biggest concern, we recommend buying and financing an inexpensive car with a loan term of 36 months or less. If you do this and make all of your monthly payments on time, you should be able to trade that vehicle in after 18 months or so and qualify for a much better interest rate (although this rate may not yet be a prime one).
The other choice isn’t nearly as smart: Many customers choose to finance an expensive vehicle with monthly payments that just barely fit within their budget. Because of the higher selling price, these vehicles have to be financed for as long as 72 months. After 18 months, when their credit rating has improved, it is nearly impossible to trade out of the vehicle and get a newer car with a lower interest rate.
The choice is simple: if you choose to buy an expensive vehicle and finance it for 72 months following a bad credit experience, you should plan on keeping that car, and the higher interest rate, for quite some time.
Begin the process now
At Auto Credit Express, our business is to help people with bad, blemished, bruised and tarnished credit buy cars and reestablish their credit at the same time. Our national network of affiliate dealers specialize in bad credit car loans. If you have any additional questions, our web site will help you determine how much car you can afford and, unlike other sites, our toll free number is listed on every page in case you have any additional questions.
So if you are serious about getting your credit back on track, you can begin the process right now by filling out our secure online bad credit car loan application.
Tags: auto credit, bad credit, bankruptcy, credit, credit score, fico, FICO score, refinance, repossession
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