In terms of car loan rates, bad credit is the greatest issue that makes loan application difficult. Many lenders as well as banks are most of the time hesitant in lending money to loan applicants with poor credit history since they view these clients as high risks and customers that are not so reliable. In addition to this, individuals with bad credit history and are now capable of improving their financial situation are also experiencing a hard time in getting a new car loan. This article provides a compilation of advice and tips on how to obtain new car loan rates and car loans for individuals with history of negative credit
Common requirements in applying for a new car loan
In order to apply for a new car loan despite the negative credit reputation you need to meet some of the basic requirements that most lenders ask for. These requirements are important in assessing the customer’s ability to pay the loan back. These requirements are as follows:
- automobile insurance policy
- personal references from 6 individuals
- phone bill
- electricity bill
- current bank account
- proof of employment
- driver’s license
- down payment
Tips in handling the loan application
- Since most dealerships and lenders are hesitant to provide loans for bad credit holders, you need to search for loan providers that are specialized in giving financing for applicants with bad credit history. You can search for this type of lenders using the internet.
- Be honest in dealing with lenders or dealerships that provide loans for bad credit holders. Most of these lenders are willing to provide discounts and rebates for applicants that are honest. All you need to do is accept the fact that your financial situation is at its worst and be ready to pay for higher interests.