subject: Usual sources of a bad credit auto loan [print this page] Usual sources of a bad credit auto loan Usual sources of a bad credit auto loan
Bad credit holders should do their best to obtain a loan in order to improve their credit scores as well as repair their credit records. Not all of these creditors wit not so good credit reputation know this fact. Due to this, some of them fail to obtain loans in the future. If you are planning to obtain a bad credit auto loan, try to search for offers from usual sources such as the following.
1. Credit unions One of the most common sources of bad credit auto loan is a credit union. These unions usually provide all the loans that their members need and most of the time offer better rates. However, these groups do not offer loans to non-members easily. As a matter of fact, membership to the union serves as the primary requirement in order for creditor to have loans such as those that are used for financing a cheap new car.
Given these fact, bad credit holders need to become a member of a credit union in order to avail the services and benefits offered by this loan source. Although this would require membership fees, creditor with bad credit records should try providing this particular requirement. The gains would surely be worth the expenses spent for the membership since credit unions offer competitive loan rates that are considered to be necessary for bad credit auto finance.
2. Car dealerships
Certain car dealerships could also help bad credit holders secure loans despite their low credit scores. This is because these dealerships are most of the time connected to car financing companies that handle the financing of their customers. Bad credit holders can actually approach a dealership and seek loan application assistance.
However, creditors only need to be very careful when dealing with this type of loan providers in order to avoid expensive financing premiums. Car dealerships usually place charges on the interest rates of the loan provided by their financing partners so as to increase their profits.
3. Specialized lenders
There are also a lot of specialized lenders that exclusively offer bad credit car loans. However, their rates are usually higher since they are taking greater risk in providing this type of financing. This could be a good option for bad credit holders in case they fail to secure loans from other sources. All they need to do to get a better rate is compare the rates provided by different specialized lenders and choose the offer with the lowest interest rate and better payment options.
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