Bad Credit Car Loans - Way to Buy Car Despite Credit Worries

by : Henry Bell

Are you carrying bad credit tag while applying for a car loan and fear that the lender may turn you down for the loan? Well, the remedy lays in bad credit car loans that are made especially to people with damaged credit history like late payments, arrears, payment defaults or county court judgments against their names. Such people are given car loans without many credit enquiries for buying new of used car of any make and model.

Bad credit car loans provide easy finance once the borrower has convinced the lender about timely repayment of the loan. This should be done through producing income documents along with past bank statements. Your focus should be on cutting risks for the lenders.

One ensured way of bad credit loans approval is to offer some security to the lender. Secured bad credit car loans require you to offer your home or any asset as collateral. The car you intend to buy can also be pledged as collateral with the lender taking car deal papers in possession and returning them when the loan is fully paid back. You can go on driving the car till then. You can borrow greater amount depending on car value and also collateral value. Secured bad credit car loans are also source of comparatively lower rate loans.

Unsecured bad credit car loans are made without collateral and so these are best loans for tenants or non-homeowners though homeowners too are eligible if they do not wish to risk property. Interest rate on unsecured car loans for bad credit people goes higher with every dip in credit score. The loan repayment for secured or unsecured bad credit car loans rages up to 5-7 years.

Take rate quotes of various lenders providing car loans to bad credit people. Compare them to find which lender is more suited to take a loan from as per your circumstances. Also ensure to buy car from a dealer known for quality cars and pay off the loan in time to repair your credit score.