According to Experian Automotive, 27.6% of new car loans in the first half of 2014 ranged from 73 to 84 months. With these longer payment plans becoming a trend, people might begin to think that extended loans are a good idea since it reduces the monthly payment. But is a long loan term the best approach to getting a new car? Not really, and I’ll tell you why.
The minimum qualifications for a subprime car loan include meeting some basic income, employment, repossession, bankruptcy, reference, driver license and age requirements.
When you are buying a car, there is more than just the loan to consider. You need to remember that there are also tax, title and license fees. So, you may be required to bring additional money to the table, depending on who you purchase the car from.
For those who live on a tight budget, this is the time of year where the window of opportunity opens up for larger purchases, like an automobile. And if your credit isn’t in any condition to help you get approval for a zero down financing offer, this window doesn’t stay open for very long. This is why your tax return could be just what you need.
You may have heard the term, “Same Day Auto Loan” before, but what does it mean? It can accurately describe two different loan scenarios, referring to simply a loan that is approved within 24 hours or a specialized loan for bad credit buyers. This distinction is important to realize as you are shopping around for the right loan to fit your situation.
Instead of thinking of a down payment as a hurdle, car buyers with credit issues should think of a down payment as a way to save themselves money as well as a way of contributing to the success of their credit repair efforts.
Unless they report all of their income, credit-challenged consumers who get paid under the table will find it very difficult getting approved by a subprime lender. But there are acceptable alternatives including paying cash as well as getting financed with a BHPH dealer that reports to the credit bureaus.