Bad Credit Car Loans Charlotte NC

A lower credit score, typically one at or below 600 points, can mean higher interest rates and fewer options. Before securing an auto loan, you should get a full credit report from at least one credit bureau. With your full credit report, check to make sure there are no mistakes or discrepancies. If you do find any, be sure to dispute them and get them corrected before applying for a new credit line, such as an auto loan. Once you have ensured your credit report looks correct, you should determine which of your current credit debts are lowest and focus on paying these off. If you find that you are not in the financial position to get an auto loan, it may be best to hold off on applying and try to take steps to boost your credit score. These steps can include making extra payments and lowering your credit card usage. 

While good credit health plays a role in getting a car loan, lenders also consider financial stability to ensure that you have the income to make monthly payments without defaulting on the loan. Lenders will look into your past financial behavior while reviewing your application. If they see you've managed an auto loan in the past, your approval odds go up. But if you have a repossession on your record, this can count against you. When you apply for an auto loan, be sure you have documentation pertaining to your income, such as pay stubs with your year-to-date earnings, especially if you have a low credit score. Lenders most often prefer applicants with a steady income from employment. However, some lenders may consider other sources of income, such as disability or child support payments. Beyond income, they'll also inspect your payment history, credit utilization, debt-to-income ratio, and payment-to-income ratio. By showing a lender your ability to meet your monthly payments will not only boost your approval odds and lead to better terms and interest rates. To further increase your odds of approval, you can also make a down payment or trade-in your current vehicle to reduce the total borrowed amount and show your commitment to paying off the loan.

Another way that you can increase your approval odds is to have a co-signer. If you have less-than-ideal credit, a co-signer can make a huge difference in getting approved for a loan. A co-signer is a person with good credit who agrees to step in and make the payments if you ever miss them. This gives lenders the confidence that one way or another, your monthly payments will be met, thus increasing your approval odds. It's important to remember, however, that defaulting on payments can still have a negative impact on your credit score. Another option is having a co-borrower. While a co-signer has no stake in the vehicle, a co-borrower shares the ownership of the vehicle and is also equally responsible for the monthly payments. Applying for an auto loan with either a co-signer or co-borrower can significantly enhance your approval odds.

If you're looking to get behind the wheel of a new car but are worried about your credit score, we understand here at Marburger Chrysler Dodge Jeep Ram. But don't stress too much; we're here to help you find a solution! Our team of financing experts knows the intricacies of bad credit car loans so you can take home the car you've been looking for! Use the contact form below to ask our team any questions you may have or to begin the financial application process. We look forward to hearing from you soon!