While the economy was trudging along many people lost their jobs and their ability to make timely payments on their different lines of credit. Now, as the economy recovers, they find themselves denied the credit that used to be so easy to get. Here are three tips to improve your chances of getting an auto loan with less than stellar credit. The tips may require that you change your thought process a little in order to qualify for the first bad credit loan. Here they are:
- Change the vehicle you try to buy. Look for an inexpensive compact or mid-size model.
- Shorten the loan duration. Try for a 36 month or less payment period.
- Double check with your insurance company. If possible, buy the model with the least expensive insurance premiums.
These tips will not guarantee you an auto loan with bad credit, but they help to improve your chances. Also, remember that if you are late on or miss a single payment your credit score will suffer even more.
A bad credit auto loan can be a hard pill to swallow after having reliable credit for so many years. Yes, you will pay a much higher interest rate than you are used to the first time around, but it will be lower the next time and the credit will be easier to get. There is hope after a second chance auto loan.