Just because you have had some past credit issues, does not mean you cannot get a car loan, and quite often a car loan can be a good stepping stone to rebuilding your credit worthiness.
There are a number of car loan financiers in the market that specialise to assist with giving second chance car loans.
Whilst your credit history may not be too bad, then you may still have options to obtain a car loan through one of the main stream automotive financiers, giving you access to normal car loan interest rates.
For those with more damaging credit history, such as financier defaults, or bankruptcies, the specialist bad credit car loan lenders may be your shot a second chance. The car loan interest rates may be higher, but at least this can give you a foot back in the credit market, to prove yourself once again, which would give you more options for the second time around.
Bad Credit Car Loan Interest Rates
A number of factors get taken into consideration when determining what interest rates would apply to your bad credit car loan.
The first consideration is mainly related to what adverse history is on your credit file and how severe it may be. Different interest rates would be applied for someone with just a small paid default, as opposed to someone who has recently been discharged from bankruptcy.
The next consideration would be your overall application, and things such as your assets and liabilities would be taken into account, your income and your expenditure and how long you have been with your same employer and same residence. Also, an important consideration is your living situation, whether you are a home owner, a renter, or a boarder.
Generally the highest the bad credit car loan interest rates would go, would be 29.9% p.a. and these bad credit car loan lenders can at times apply their interest rates as low as some of the main stream lenders.
The most important lending criteria are that you are in paid employment, any bankruptcies have been discharged and that you can afford to repay the loan based on the lender’s calculations.
The bad credit car loan lenders will also review your bank statements and would be looking at any regular direct debit dishonours or overdrawn amounts on your bank account. A big deterrent is if they can see regular large sums being withdrawn from your accounts at casinos, pubs or hotels that may give them a fear of problem gambling.
It could be a good idea to speak to a professional to assist in presenting your application in the best possible light to any bad credit car loan lender, so they can assist with the right timing to apply and the collation of all the required documentation.
CarLoans.com.au can provide you a free car loan assessment, this assessment will determine what loan product suits your needs best as well as providing you with the interest repayments - click here to get a free assessment.