Car Loans and Bad Credit – Your First Steps
Almost all of us need to use a car in our daily lives. But if you have bad credit, getting a car loan in Barrie can be a difficult hurdle. Luckily there are companies like Auto Loan Services that can facilitate a vehicle purchase despite a bad credit history.
Before you begin the process, there are several things you should consider:
- Be very clear what kind of car you need – and be realistic. You don’t need a Ferrari to get to work!
- What size of vehicle do you want? Is it for your personal use – or do you need something family-sized?
- Will the car be used to transport goods for a business?
- The auto loan company will require monthly payments, so you must be very clear as to what you can actually carry. Bad credit loans are often of shorter duration – thus requiring higher monthly payments. Don’t forget you’ll need insurance, fuel, maintenance – and, depending on your living arrangements, parking fees.
- Check your credit history
The Advantages of Purchasing Over Leasing
Before you commit to buying a car with a loan, consider leasing for a moment. It’s basically a long-term rental of a vehicle, usually with an option to buy the car outright at the end of the leasing period. There are advantages to leasing – ‘if you qualify’.
But those are the key words. In addition to the difficulty you may have in getting approved, leasing can be a cost negative. Depending on how long your lease is you may end up paying more overall than if you’d bought the car outright. And, when the lease ends, you do not own the car.
Moreover, leases are typically arranged through dealers. They are wary of any hint of bad credit because they are in the business of moving cars – not dealing with loans outside limited parameters.
The drawbacks of leasing bring you back to the most likely scenario: buying a car outright with a loan and getting that vehicle from a company experienced at dealing with the needs of a purchaser with bad credit.
What to Look for in a Specialty Finance Company
The basic requirements for a bad credit car loan in Barrie begins with a valid Ontario Driver’s license; proof of income (either pay stub or three months of bank statements if self-employed); insurance information; and a Void cheque or pre-authorized debit form.
From there, a broker can begin working with you, starting with a confidential discussion of your financial situation. Bankruptcy is not an obstacle. Vehicle trade-ins can be considered. Once the state of your finances are clear, the broker will set you up with a lending partner and secure the lowest possible interest rate and best financing program for your purchasing needs.
Once approved, it’s time to select a vehicle. Auto Loan Services has a large dealer network with access to over 5,000 new and used vehicles. Finding the perfect vehicle for the needs you have already clarified should be easy, but the company also offers a thirty-day Vehicle Exchange Program.