Many of our customers come to us with bad credit and are trying to get a car loan. Having bad credit does not mean that you can’t get a car loan, like many of our customers initially think when they first contact us. In fact, you can not only get a bad credit car loan that suits you financial needs, but your bad credit car loan can actually improve your financial situation.
Here are a few things that you need to know about how bad credit car loans can improve your credit:
Car loan interest rates are based on credit
It’s important for you to understand how car loans work. More importantly, if you have bad credit, it’s important for you to be aware that your car loan rate will be based on your credit. When you have bad credit, you will be able to get a car loan, but the interest rate that you will be paying on that car loan will be greater than the interest rate that you would be paying if you were to have good credit. This is because lenders base their interest rates on several conditions, including economic conditions, the lender’s lending capability, and a borrower’s credit.
When you have bad credit, it is usually because you have made some bad financial decisions in the past – whether you are responsible for them or not. You may also not have a very long credit history, which could cause you to have bad credit. When you have bad credit, lenders can not have the same confidence in your ability to be financially responsible as they might have with a borrower who has good credit. Therefore, in order to ensure that they will receive a return on the money that they loan to you, the lender may charge a higher interest rate.
Bad credit car loans can improve credit
Bad credit car loans can improve your credit as long as you repay the loans because they will be showing lenders that you have developed a credit history and are capable of being financially responsible by repaying the loan on time and in full. Therefore, taking out a bad credit car loan can help to improve your credit and lower your interest rates in the future.
Contact us today for more information about our loan program or to get started with your bad credit car loan!