New information from the American Automobile Association should help consumers with questionable credit see that the type of vehicle they pick can make a big difference in the overall cost of a car loan
Our experience

Choosing the right type of vehicle is arguably the most important decision that consumers with problem credit can make if they hope to successfully complete an auto loan.

We understand that here at Auto Credit Express because for more than twenty years we've been helping car shoppers with poor credit find those car dealers that can give them their best opportunities for car loan approvals.

Auto loans with less than perfect credit

We are sometimes faced with the situation that car buyers with bad credit think they can finance a, van, large sedan, or even a full-size SUV.  But even for those few with the income and down payment to qualify for one of these types of vehicles choosing one can potentially lead to big problems later on.

The fact is most consumers who are credit-challenged won't qualify for one of these relatively expensive vehicles because the interest rates charged by high-risk lenders usually put the monthly payments at or over the limit of most budgets.

Secondly, higher auto insurance rates and poorer fuel economy make large cars, vans and trucks even more expensive to own.

Recently the American Automobile Association released their 2013 "Your Driving Costs" study that helps answer the question of "how much will a car loan cost?" with a number of facts.

2013 AAA study

According to the latest American Automobile Association (AAA) study released on April 16th, maintenance costs were responsible for the single largest increase, up 11.26 percent between 2012 and 2013.

Based on 15,000 miles per year, this is what the organization has determined are the average costs of operating a vehicle based on its size and type:

Small sedan – 46.4 cents per mile or $6,967 per year
Medium sedan – 61.0 cents per mile or $9,151 per year
Large sedan – 75.0 cents per mile or $11,248 per year
Sedan average – 60.8 cents per mile or $9,122 per year
Minivan – 65.3 cents per mile or $9,795 per year
4WD SUV – 77.3 cents per mile or $11,599 per year

In addition to fuel, the above costs also take into consideration depreciation as well as tire and auto insurance expenses.

Computing your operating costs

This means that buyers, regardless of their credit scores, can save over $2,000 a year simply by choosing, be it new or used, a small car over a midsize sedan – a savings that borrowers can use at the time of taking out a loan to lower the payment, shorten the loan term or free up cash to pay their other bills.

According to John Nielsen, AAA Director of Automotive Engineering and Repair "Before you make any vehicle purchase, it is important to determine ownership and operational costs and compare them to your current and future financial situation."

To further help consumers, the AAA 'Your Driving Costs' brochure, available at AAA offices, contains a worksheet that can be filled out and personalized for a specific area, driver and vehicle.

As we see it

For consumers with bad credit, financing a vehicle to establish auto credit means the time has come to get practical in choosing a car. By buying a smaller car that's less expensive and cheaper to operate while making the monthly payments on time, chances are very good that the next one financed will qualify for a lower interest rate.

One more thing to keep in mind: Auto Credit Express our specialty is helping credit-challenged consumers find those car dealers that can give them their best chances for approved car loans.

So if you're ready to reestablish your car credit, you can begin now by filling out our online car loans application.