It is very difficult getting approved for a car loan on a 10-year-old vehicle with more than 100,000 miles, especially if the buyer has bad credit. Although an older car with higher miles might seem affordable, subprime lenders perceive these vehicles as high risks for breaking down (a real issue especially for a high-performance car like a WRX STI).
According to the latest market report from Edmunds.com, used subcompact, compact and midsize cars, many of which are ideal vehicles for credit-challenged borrowers, should be even more affordable this year. With this in mind, consumers who know their credit scores and reports and have a decent down payment might want to seriously consider pulling the trigger on a “nearly new” car.
Although pricing in the used car market remains strong, the affordable vehicles that are most appropriate for borrowers with bad credit are, at least at this point, more affordable than they were last year. This being the case, now might be a good time for buyers with tarnished credit to pull the trigger on buying a subcompact, compact or affordable midsize used car.
Credit-challenged consumers who want to cash in their current vehicle might want to consider doing so at a dealership as opposed to a website like Craigslist. Even though they might not get top dollar for it, the extra money might not be worth the hassle or the chance of becoming involved in a car buying scam.
This past Memorial Day weekend, I was stranded in the Houston airport during the record setting storms that pummeled Texas. The torrential rains and terrible lighting were powerful, but as terrible as these storms were for Texans, the trouble was just beginning. Countless vehicles that were submerged by flood waters are now being labeled salvaged, cleaned up and are beginning to reappear across the country.
Consumers with checkered credit are far more likely to get stuck financing a vehicle with hidden damage than other buyers. By following all the above steps they can prevent this from happening.
Buying a used car doesn’t have to be a scary or stressful experience. Just make sure that you get detailed information from your dealer so that you’ll be able to make the best choice possible, and that you won’t have any unpleasant surprises come up down the road.