A lot of consumers bristle when they hear the term "bad credit car loan." This is because subprime lending is often unfairly associated with shady business practices. However, bad credit car loans definitely serve a valuable purpose.
This isn't to say that subprime auto financing is completely free of dishonest practices. Unfortunately, some buyers have been taken advantage of here and there. However, for the most part, bad credit car buyers are treated fairly and with respect.
And most subprime professionals (lenders and dealers) care about helping buyers in two important ways. First, customers get the cars they need. With a bad credit car loan, they don't have to settle for an older vehicle with a lot of miles on it. Instead, they can purchase a new or recent model used car that will be reliable and last for many years. And second, they are given a chance to get back on track with their credit.
The Truth about Bad Credit Car Loans
According to several recent studies, nearly a third of U.S. consumers have a credit score that is lower than 601. This number, according to Experian, marks the distinction between “bad” and “fair” credit. So, at least one third of Americans might be turned down for auto financing if they applied with a bank or credit union.
Does this mean that one third of U.S. citizens shouldn't have access to reliable transportation? Just because a person has had some trouble with credit in the past, should they be denied a car loan? No. Lenders and dealers who work in subprime believe that everyone deserves a second chance.
Do bad credit car loans come with higher interest rates? Yes. This is unavoidable. Interest rates are based on risk, and a low credit score does pose a certain amount of risk to a lender. However, bad credit car loans give buyers the opportunity to improve their credit. Through prompt payments, they will be working toward getting a better interest rate the next time they buy a car.
Do bad credit buyers have limited vehicle options? Yes. Normally, qualified subprime dealers will only show buyers the cars that they can comfortably afford. This is a good thing because the last thing a subprime customer needs is an overly expensive vehicle that might set them back further.
Bad credit car loans are meant to give consumers with credit issues a chance to get back in the game. With special financing, they can get the cars they need and a means to start repairing their credit. They may not get their dream cars or ideal interest rates, but they'll be one step closer to better times ahead.
Getting a Bad Credit Car Loan from a Reputable Source
Because, unfortunately, there are dishonest people out there, you cannot simply believe everything you see on the internet. You should also be cautious about anything you receive in the mail. This is especially true if you're looking for a car loan and planning to put a lot of money on the line.
So if you have bad credit and need to buy a vehicle, look for a reputable source. Because of your situation (one that you share with many Americans), you won't be able to just walk into any dealership and get financed. First, you will need to find a dealer that is connected to the right kinds of lenders. And the quickest way to do this is to get assistance from the subprime experts at Drivers Lane.
Easy Auto Financing Assistance for Bad Credit Buyers
At Drivers Lane, we've been helping car buyers with bad credit get auto loan approvals for nearly two decades. We can quickly match you with a dealership in your area that can give you your best chance at getting financed and back on the road. You may even be able to purchase your vehicle with little or no money down.
There is no cost for our service and you'll be under no obligation when you apply. So go ahead and fill out our simple and secure online application to get started today.