Don't get stuck on the side of the road! If you have bad credit and know you will need a new car, now is the time to prepare to buy that car. Decide on the car you want (preferably used), set your budget, save money and make sure you clear your credit of any negative information. Lenders are not going to finance a car, if you have poor credit and no downpayment.
Ideally you should get pre-approved by a bank or credit union BEFORE you walk into the dealership. Make sure you pull your credit report and know what's on your report before you walk into a dealership. If your credit utilization is high or you have been late on payments, lenders may be leery to finance a new car, if you can't make timely payments or your credit cards are maxed out.
Your options are limited when you have poor credit, but not impossible. My suggestion, purchase a car for cash until you can save enough money for a downpayment and repair your credit.
If you can't wait, you need to be aware that your interest rate will be higher for poor credit auto loans (possibly in the neighborhood of 20-27%). At this rate of interest, you could possibly pay up to three times the value of the car. Secondly, your new lender will want you to add physical damage coverage to your car, before you leave the dealership. Do you have the downpayment for the additional insurance? What about gap insurance, extended warranties, doc & dealership fees? The costs do add up. Do you now see why it's so important to prepare your finances before purchasing a car?
Purposeful Credit Solutions can assist you in repairing your credit and help you with the car buying process. Contact us today for your automotive credit solutions!