Consumer Car Buying Advice Blog

There is a way to raise your credit score and reestablish your car credit at the same time

How to improve your credit score

If your credit has recently turned from good to bad, you may be wondering how to go about raising your credit score and reestablishing your car credit. We’ve seen this before because at Auto Credit Express we’ve been working with bad credit car buyers for the last two decades.

Due to this fact and after experiencing the embarrassment and rejection that customers with bad credit often face, we launched a web site that, among other things, features a bad credit car loan application. We then match up applicants with local dealers that specialize in customer credit issues – dealers that look for ways to get customers approved, instead telling them they can’t help.

The other option for many bad credit buyers – buying a vehicle from a tote the note, we finance anyone car dealer – won’t help because most of these dealers don’t report car payments to the credit bureaus. At the same time, taking out a loan through a dealer with a bad credit lender without understanding the process can also create problems. In either case, the result could be repossession – setting your credit repair efforts back even further.

What you should realize is that there are lenders out there that are willing to help consumers who have bad credit – especially if they can identify a single economic event that caused a previously good credit rating to drop.

Lift your credit score

Getting a bad credit car loan provides an excellent opportunity to raise your credit scores. As you go through the process of purchasing a vehicle, 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 auto 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, your credit scores will drop even further.

Making the most of car loans with bad credit

Before you buy a car using auto loans for bad credit, you need to set your priorities. If re-establishing your auto 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).

On the other hand, 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.

It boils down to this: 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.

Start the process now

At Auto Credit Express, we specialize in placing customers with bad credit with dealers that can help them. Our affiliate dealers are knowledgeable and work with a broad spectrum of lenders to ensure you have your best chance at getting approved for a car loan.

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 auto loan application.

Tags: Bad Credit, bad credit auto loans, bad credit car loans, Credit Repair

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