Although the subprime market continued to grow during the first quarter of this year, the increase in repossession rates is sure to cause these finance companies to moderate the pace of lending. If this happens, borrowers with larger down payments (with cash down or real trade equity) who are willing to consider a range of affordable vehicles will have a much better chance of receiving an auto loan approval.
Though they may have some flaws that show up on their credit reports, even these consumers, in most cases, owe it to themselves to check out their local bank or credit union before going the indirect lending route.
Once you know for sure that you have issues with your credit, it’s important that you explore all your financing options to see which one makes the most sense for your current situation.
Before applying for any kind of loan, it’s important that you know the information contained in your credit reports is accurate as well as at least one of your credit scores.
Here at Auto Credit Express we’ve had a chance to review the latest report from TransUnion on auto delinquencies and, in our opinion, it contains good news for consumers with poor credit that need to finance a car.
For consumers with credit issues, financing a vehicle for a longer loan term – especially if the loan has a higher interest rate – can add significantly to the finance charges. On the other hand, financing a new or used car for the shortest term possible lowers the interest expense of the loan and usually allows buyers to trade out of their vehicle sooner so they can take advantage of lower interest rates the next time around.