Although grades were important in your education life its importance is still there in other parts of our life as a credit score. A credit score is a numerical value that tells all about a person’s ability to pay off its loans. There are three credit rating agencies that are working to provide credit score, namely Equifax, Experian, and TransUnion. In addition to the credit score, you should also get your credit history from these agencies. Credit history tells all about your loans, your payments, your defaults, and late payments. If you are looking to buy a car, then you can do so either paying the full payment at the spot or get it on a lease basis.
Buying a car on a full payment basis is not always a suitable solution for everyone. At least 90% of car buyers get their cars on the lease because they can easily manage the rental payments and down payment with their salaries and income. But what can be done if you have already taken a loan from financial institutions or banks and have to make defaults in payments? Leaving defaults separate, even due to the financial crisis you have to skip payments or make delayed payments. This all contributing to a bad credit history, which is the main obstacle in your objective of buying a car with bad credit history.
A car loan is not like a normal type of loan where lenders keep your property as a mortgage. And if you do not pay and make default, they sell your property and get their money back. So, there is an involvement of high risk and lenders cannot give a car with bad credit history to you.
Ranges of Credit Score (also called FICO)
Good … 680-700
Sub Prime … 500-640
Bad … Below 500
But, if due to some reasons, you have a bad credit score, then still you can still get a car. The following tips and guides will help in Buying a Car with Bad Credit History.
Regularize your payments
Your credit history report will give you all the details about why your credit score is bad. Identify these payments and try to pay the minimum amount. You can easily find the number of minimum payments in the bill received every month at your doorstep. Make sure you pay the minimum amount before the due date.
Business Credit Card
It might possible that your store credit card is the reason of your default. Because sole proprietors often treat their business separate from themselves, but in the eyes of credit rating agencies, you are liable for your business loan defaults contributing to a bad credit score.
Apply Later
We know that you are keen to buy a car and you want to get it immediately. Do not do hurry, work in a systematic way, make a working plan. The plan should not be too rigid that you may not follow. First determine the total amount that you can pay towards your loans, and then rationalize this amount between various loan’s minimum payment.
Find a Cosigner
A cosigner is a person who takes responsibility if you make defaults in making payments. Although, it is very difficult to easily find a Cosigner, still you can search him/her. Please make sure that your co-signer has a good credit score and a good credit history.
If you follow the above guides and work professionally, there are strong chances that you will be buying a Car with Bad Credit History soon.
A car loan is not like a normal type of loan where lenders keep your property as a mortgage. And if you do not pay and make default, they sell your property and get their money back. So, there is an involvement of high risk and lenders cannot give a car with bad credit history to you.
Ranges of Credit Score (also called FICO)
Good … 680-700
Sub Prime … 500-640
Bad … Below 500
But, if due to some reasons, you have a bad credit score, then still you can still get a car. The following tips and guides will help in Buying a Car with Bad Credit History.
Regularize your payments
Your credit history report will give you all the details about why your credit score is bad. Identify these payments and try to pay the minimum amount. You can easily find the number of minimum payments in the bill received every month at your doorstep. Make sure you pay the minimum amount before the due date.
Business Credit Card
It might possible that your store credit card is the reason of your default. Because sole proprietors often treat their business separate from themselves, but in the eyes of credit rating agencies, you are liable for your business loan defaults contributing to a bad credit score.
Apply Later
We know that you are keen to buy a car and you want to get it immediately. Do not do hurry, work in a systematic way, make a working plan. The plan should not be too rigid that you may not follow. First determine the total amount that you can pay towards your loans, and then rationalize this amount between various loan’s minimum payment.
Find a Cosigner
A cosigner is a person who takes responsibility if you make defaults in making payments. Although, it is very difficult to easily find a Cosigner, still you can search him/her. Please make sure that your co-signer has a good credit score and a good credit history.
If you follow the above guides and work professionally, there are strong chances that you will be buying a Car with Bad Credit History soon.
