You may relate to the experience of thousands of others who are in need of a car but who cannot seem to find a bank who will approve them for an auto loan. If so, you already know the frustration a person can feel when they are not able to get behind the wheel of their own car just because their credit score is too low.
The fact is, a person’s credit score does not tell the whole story about whether a person is creditworthy. Rather, there are a number of factors that should be taken into consideration. Unfortunately, 99% of banks out there only look at your credit score when deciding whether they will approve your auto loan application.
The good news is that you can find online banks that will extend you a bad credit auto loan. The key is knowing how to look for the right lending bank, how to prepare for applying for a car loan, and how to carry out the application process.
If you are interested in finding online banks for bad credit auto loans, here are 5 things to look for:
1. Be sure they advertise themselves as a bad credit auto loan bank:
Banks are not all the same. If you just walk into a local bank branch to apply for an auto loan – and you have a bad credit score (say, a FICO score under 600) – you are likely to get rejected for a loan on the spot. However, if you look for a “bad credit auto loan” bank, you are much more likely to find one that will approve your application. These banks specialize in working with people who have less-than-perfect credit but who need an auto loan.
Do some online research and make a list of at least 5-10 banks who advertise themselves as bad credit auto loan lenders.
2. Find a bank that you can trust:
Banks come in all shapes and sizes. How can you know which type to choose? Well, you need to start by finding one that you can trust. And, remember, it is not necessarily the big banks that are the most trustworthy: there are countless stories each month about judgments in court made against many big-name banks, whereby the court has found the banks acting in inappropriate ways.
Once you have your candidate list of banks (see #1 above), do some research via online discussion boards to find out any positive or negative comments about them. Take careful notes!
3. Make sure they are FDIC insured:
Before applying with any lender, do a quick check with their website to make sure they are FDIC-insured. This is the sign that they are a legitimate bank with everything in order.
4. Check your credit score before applying for a loan:
Now, run your latest credit report to find out your current score; it may have changed since the last time you checked it. Also, be sure to make a note of any items you find there.
5. Shop to get yourself the best loan rate:
Now, it is time to start shopping. The biggest mistake many would-be auto loan borrowers make is to just apply to one bad credit car loan bank, get accepted, and move forward with that bank. But, doing so without shopping around further could put you in jeopardy of not getting the best-possible deal.
Look for these 5 things as you find the right online bank for bad credit auto loans.
By bernswaelz from Pixabay