Auto Financing for Bad Credit

May 10th, 2021 by

Bad Credit Car Financing

Bad Credit Car Financing

Bad Credit Car Financing. If you’ve ever financed the purchase of an expensive item such as a car or a refrigerator, you know your credit score is vital to getting a good deal.

Having a good credit score can help you acquire a lower interest rate, while a poor credit score can cause you to pay more since it indicates a higher risk to the lender.

At House Cars Arizona, we want to help you in your future purchase of a used vehicle, which is why we want to provide you with some practical steps to help you be in a better position to get the best rate available to you!

Check Your Credit Score

An important step you should always consider is checking your credit score. That way, you’ll know where you stand so that you can manage expectations regarding loan eligibility and be aware of what you have to do to bring up your score (more on that below).

Improve Your Score

If you already checked your scores, you will get information about what is negatively affecting your score the most. This information will help you know what changes you need to make to start improving your credit score.

Specific credit scores are more significant than others. Payment history and credit utilization ratios compose most of your credit score. However, which of these affects the most varies from person to person.

Here Are Some Tips to Boost Your Credit Score:

-Pay Bills on Time

Lenders are usually very interested in how reliable you are in paying your bills. Past payment performance is considered to be a telltale sign of future performance.

If you are behind on payments, bring them current as fast as possible. Don’t worry. The negative impacts and factors on your credit score decline over time.

-Dispute Inaccuracies In Your Credit Reports

We also recommend reviewing your credit reports to see if there are mistakes that could be holding down your score.

You’d be surprised how a single mistake on a credit report could topple your credit score. Dispute any inaccuracies you find in your credit reports.

-Pay off Debt and Keep Balances Low

We mentioned the credit utilization ratio before. It is one of the most critical factors in calculating your credit score.

Calculate your ratio by adding all your credit card statement balances at any given time and divide by your total credit limit. You can better your ratio by paying off debt and keeping card balances low.

-Beware of opening new credit accounts

Having more accounts probably won’t improve your score. Unnecessary credit can create inquiries, which can lead to overspending and accumulating debt.

-Closing Unused Credit Cards

This one is also a no-no. Keeping unused credit cards open is an excellent tactic as it keeps your utilization ratio lower.

Closing accounts may increase your ratio. Be sure to keep them open (as long as the cards are not costing you money in annual fees).

-Check with different lenders

Check with different lenders and compare their rates and loans, see which option is more suitable for you. Some types of lenders provide auto car loans even with low credit scores.

-Provide a bigger down payment

Providing a bigger down payment can help reduce the amount of loan you need for a car. Of course, a smaller loan means less interest.

The amount of money you should put down will vary depending on your credit score and your financial situation.

House of Cars is Here For You Regardless of Your Credit Score

At House of Cars Arizona, we provide good pre-owned vehicles to our customers and provide financial assistance to those in need (even those with bad credit scores).

If you find yourself with poor credit, our finance team can help you step into the car of your dreams with one or more of our many offers. Our process is fast and straightforward.

Contact us and be ready to hit the road today!

Posted in Finance