Posts tagged ‘sub prime auto lenders’

A Quick Guide for Student Car Financing

There are now auto loans for students that enable them to get a loan without having any credit. By showing that you have a down payment, proof that you are employed and have a checking account you can be off to the races at achieving that purchase you so long for. But in many cases this is a lot easier to say than do.

Establishing Credit

Most students have never had a credit record or are just at the beginnings of acquiring one and the banks want you to have one already established before they take a chance on lending the money.

With all the expenses that a student already has, tuition, books and other living expenses, it`s hard to find any extra to purchase a car. That`s where the student loan car financing comes in.

Apply Online

By applying online a student can almost right away be accepted for a loan. It`s hassle free and fast and you won`t get charged for late payments. Also this is a good way to either build your credit or repair it.

Searching online for pre approved loans will bring up quite a good selection of companies willing to help you and give you a loan quote. The quotes are free and there is no obligation to purchase. Of course the quotes will depend on your budget and what you need for the car purchase. Based on the strength of your employment record they will select the best options for you to choose from and allow you to go on out and select your car.

Sub Prime Lenders

Sub prime auto lenders are good if you have a bad credit rating as well although keep in mind the interest will be a little higher due to the fact that they are risking lending you the money.

All in all auto lenders will make it a lot easier for the student to get that car.

Sub Prime Auto Financing

Sub prime auto financing is categorized that way in order to separate it from “prime” auto financing. Qualifying as sub prime borrower simply means that your credit score is bad and that lenders see you as a lending risk. This is not a death sentence, but it does put your in a bad position when you go to get a car loan.

Here’s the scoop, there lenders that specialize in sub prime auto financing so you will have options. The problem is that because you have bad credit you will be required to pay a higher interest rate than borrowers with good or excellent credit ratings. So now that you recognize your problem you need to take steps to solve it.

Start by:

  • Getting your credit report: see where you made mistakes (check for credit reporting agency errors too)
  • Then get your credit score: find out how bad the situation really is
  • Then do your homework and shop around: do not rely on the dealership where you plan to buy your car to offer you a deal, examine a lot of sub prime lenders and choose the best

Knowing all this information and going into a dealership armed with a couple other financing offers will put you in a much better position than simply relying on the dealership to provide you with financing.

Sub prime auto financing is not an ideal scenario for anyone. However, if you recognize how you got in the position to be labelled a sub prime borrower, and then become proactive in making your car payments on time in addition to timely payments on other loans and financial obligations, you credit score will soon improve. Hopefully, then you will not have to worry about obtaining sub prime auto financing again.