Of late, we have come to hear a lot about bad credit auto loans. A common volley of questions related to this type of loan are as follows:
- Is bad credit auto loan a hoax or a reality?
- Who provides such loans?
- How to apply for the same?
- Is the approval procedure time-consuming or fast?
- What is the rate of interest charged?
The concept of bad credit auto loans is popularized by the private auto dealers. This type of loan is introduced in the marketplace for the benefit of people who need a car urgently but don’t have the necessary amount of cash ready at hand to invest in their favorite model.
The traditional lending institutes such as banks and credit unions never entertains people with a bad credit score. These institutes believe the individuals won’t be able to pay off the final amount on time leading to cases of defaults. The situation holds true even today. The auto dealers have tried to help people with below the average credit score fulfill their dream of riding home a brand-new car or a used car whatever is their personal preference. You may question why are the auto dealers so lenient in offering a bad credit car loan? Well, according to the automotive industry experts, the dealers give such a loan to boost their car selling business. People who for so long could not buy a car because of poor or no credit can now easily move forward with their car purchasing decision applying for a bad credit loan without any hesitation.
The application procedure is pretty simple. You visit a dealer’s website at any time from any place in the world to access an online car loan application form. You open the form, fill in the fields/sections mandatory (both personal and financial) and click on the submit button to send the application online. Usually, all dealers follow a swift pre-approval process by emailing you their decision within 24-48 hours after the submission of the form.
After you answer to the pre-approval decision email, the customer care team will request you to meet in-person for discussing in detail about your loan requirements. The support executives will explain you and guide you throughout the entire lending process from start to finish to educate you how they work.
Usually, bad credit auto loans approval process takes less time; however, the length of time depends on how fast you submit the papers required for a smooth financial transaction. The auto dealerships ask for only the most essential papers including identity proof, address proof, age proof which you need to submit personally at their office by dropping in at a convenient time. Overall, getting a bad credit car loan takes a maximum of a week’s time; not more than that.
It is a common sense that a person with a bad credit will find difficulty in repaying the loan with a high rate imposed on the amount. Hence, almost all dealers worldwide provides special finance loans at a low interest rate. It becomes easier for a person with a tight finance to pay off the final amount of money (principle and interest) without any problem when the rate of interest charged is minimal.
Besides, these auto dealers also offer loans with zero down payment option. Down payment means an initial payment made to the seller by the buyer on a car. Individuals with no money may face a real challenge trying to collect the down payment amount. Many dealers again ask for a low down payment if not for a zero down payment.
Bad credit auto loans can be repaid on an installment basis every month just like a home loan. A person has the discretion to choose the number of months (twelve or thirty six) to pay off the full lending amount at the end of the loan term.
Thus, there is no way to say bad credit car loan is a distant dream; in fact many people these days are applying for such a loan to take home a car within their budget.
PS: Take your time to choose an auto dealer or lender before taking a bad credit car loan. Read the instructions carefully posted on the dealer’s site. If you want to gather more information about the dealer or about the bad credit loan approval procedure, directly call the lender’s office or email writing down your queries.
I, Dulce Martin is a car lover and is the owner of 4 different types of car. I enjoys writing about cars and about the auto credit loans. I myself have bought 2 cars of mine against a loan.