Getting cars with bad credit car finance

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Getting cars with bad credit car finance

7th December 2010

Most people need a car these days, for the obvious reasons of getting to work, shopping, and getting around to places you need to be! And for as many people that have a car, there must be a nearly just as large population who don’t have the money to just put down the amount needed in order to buy the car. It’s quite like people who are buying a house. These are the two largest purchases you will ever make in your life, and very few people have several thousand pounds to just throw at this kind of purchase.

If you are already strapped for money, purchasing a car can take huge amounts from your assets, unless you do the obvious and take out a car loan. Most people take out car loans as they make purchasing a car much more accessible for people with little cash.

Before you agree to getting a car loan, however, you must do your research. You must make sure that taking out this car loan is absolutely the best option for you. Nobody should take out a loan without doing some research, before hand, as this is a commitment that can lead to difficulty if you do not stick to it.

Most people who think that it will be difficult to apply for the loan will have bad credit. People who have bad credit often think that getting a car loan will be particularly difficult, and if not, near impossible. If you need to apply for bad credit car loans, you might be happy to know that there are firms out there that can cater for your needs. Perhaps you should first know your way around car dealers and finance firms, in order to make the most out of your less than desirable situation.

The first thing you must know is that most car dealerships will mark up the inventory price of the cars. You may already understand this, but another thing worth noting is that they ca easily mark up the rate of the interest you pay, through finance. This can be done just as easily, and just as discreetly.

When you apply for your bad credit car finance, in order to purchase your car, you will have your credit application submitted to their preferred lenders. Say for instance your lenders will approve your credit for a rate of 11%, the car dealers will then tell you that your application has been approved for 13%. This will be done because they are safe in the knowledge that you have bad credit. This 2% mark up will be absolute profit for the dealers, on top of the full commission that they get from sale of the car.

You are then left with the decision of whether you really need the car, and if you absolutely can’t come up with the full purchase price. This, unfortunately, is the cost of having bad credit when it comes to buying cars. But it’s your only option, and at least means getting a car is not impossible for you.


Posted in Car finance

 
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