Low Income Auto Loans - Is It Possible To Get A Car Loan With Low Income?
Modern technology has gifted man one of his greatest passion cars
. Ever since the invention of steam engine vehicles in 1769, cars have been popular. Everyone is just floored by the beauty of a car.Sadly, buying a car has become difficult. All thanks to high purchase prices of these beauties. Most new cars start from $20,000 and a good used car is also expensive. Also, the gas prices are increasing which makes car buying very hard.
The economy is reviving and people have just started getting their jobs back. Finding a high income job is still a challenge. This creates a very bad situation because a car is needed to reach your work place but you cannot afford it with your job. Lenders have understood this situation quite well and that is why low income auto loans have been introduced.
Most lenders require you to earn at least $1,500 per month. But, you can avail these loans even if your income is as less as $1,000. Now, dont worry if you earn less than it because there are many other factors which decide your approval. Know them so that you can tackle them well.
1. Credit Score - Higher the score, better it is.
2. Credit Profile - Here the requirement is that it should be longer.
3. Term of Loan - You should try and keep it short.
4. Loan to Value Ratio - 70% -80% is optimum.
5. Down Payment - 10%- 20% would improve your chances.
6. Employment Term - At least six months.
7. Time at Residence - You need to be living at the same residence for at least six months.
8. Co-signer - Having a co-signer reduces lenders risk.
When you have a low income, you must be better at these aspects. Now, it is quite possible that you have a bad credit score and earn less. For such a situation, get a larger down payment and search for a co-signer.
Now, as you have low income, it is essential that you dont go for a very expensive car. If you go for an expensive car, its payments would also be huge. To avoid them, you will have to go for an unnecessarily longer loan term. This will increase the chances of an upside down loan. Hence, a used car is your answer. Once you improve on your income, you can always buy your dream car. Right now, it is important to get you a car that works for you. When you go for a pre-owned car, dont forget to read the Vehicle History Report. Its always good to know what you are getting into. Also, get the Odometer Disclosure Report because few lenders do ask for it.
Applying for Low Income Auto Loans is simple because you dont need any additional documents. The only important thing is to prove your income. For that, you can use your recent pay stubs. If you are self-employed, it is important that you provide your IT details to the lender.
Low income auto loans are easy to get and a boon to those who are struggling with low income. So, dont wait anymore. Cars are a necessity and its time to fulfill your car needs.
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