Many people believe their bad credit rating prevents them from getting car loans, but Loantec has helped thousands of clients with poor credit scores secure financing for a range of vehicles. Our team can help you get a car loan even with bad credit, and we provide you with all the factual details, so you can make an informed decision.
Ready to find out your bad credit car loans options? Simply fill in our pre-qualification form or talk to our Finance Technicians to get your car loan at a low interest rate today!
How Does Bad Credit Rating Affect Car Loans?
When you go to get a car loan, a bad credit rating can be a major roadblock. Once a credit check is done, lenders will receive your credit score. This serves as an indicator of your financial reliability. If lenders see a poor score, it can result in two likely outcomes, rejection of the loan or a higher interest rate.
At Loantec, your credit score won’t have as much of an impact on your ability to get a car loan as you might think. Our Finance Technicians take your individual circumstance into account and work to get you approved when traditional lenders refuse to help.
Our Tips to Get Better Car Loans with Bad Credit
Increasing the Down Payment
The larger the down payment you have, the higher the likelihood you’ll be approved for the loan. To put it simply, when the total amount you’re paying back is lower, the lender will be taking on less risk. If you’re willing to put down a large amount as a deposit, it shows the lender you’re serious about the loan.
Having a Co-Signer
If you have a poor credit rating, a co-signer can prevent a high interest rate or rejection of the loan.
A co-signer is someone who applies for the loan with you and is equally liable for repayments. Having a co-signer with a better credit rating will improve the chances that you’ll receive a loan.
Having a Guarantor
The difference between a co-signer and a guarantor is that the guarantor isn’t responsible for the payments of the loan. Unless the original applicant defaults on the loan and all appropriate actions to get the money from the applicant have failed. At this point, the guarantor becomes responsible for the repayments. A guarantor with a good credit rating will likely improve your chances of getting quick approval for your loan.
Buy a Cheaper Car
A more affordable car can increase your approval chances. The less you’re asking to borrow, the more likely you’ll get the loan. Every loan comes with a certain level of risk to the lender. But when there’s less to lose, there’s a greater chance you’ll get approval.
When you speak to our Finance Technicians, we’ll walk you through your options and let you know how much you can borrow. If it’s less than you need for your car, we can help you improve your borrowing capacity to get your approval.
What Should Be Done Before Submitting for Car Loans with Bad Credit?
Your credit score has a major influence on your ability to secure financing when applying with most lenders. Having a poor credit score can disqualify you from getting many loans. We take steps before submitting your application to improve the loan you will receive.
Check Your Credit Score
Before you assume you’ve got a bad credit score, you need to know what your credit rating actually is. Let Loantec’s Finance Technicians analyse your credit report, and we’ll find any marks against your record that shouldn’t be there. Our team specialises in removing negative marks that are on your record in error. If you want your credit score to be the best it can be, the first thing you should do is call Loantec’s team of experts. We’ll provide you with everything you need to make the most of your financial situation.
Improve Your Credit Score
One way to reduce the effect bad credit scores have on car loans is to improve your current credit rating. Make sure to keep your payment history as positive as possible by paying all your debt and bills on time. This will ensure your credit score gradually improves.
Reducing your debt as much as possible is a great way to improve your credit score. Having fewer repayments means you have more income available to pay back a new loan.
Avoid Further Damaging Your Credit Score
This may seem like an obvious piece of advice but sometimes there are actions you can take that hurt your credit score without you knowing. Applying for a new credit card or loan harms your credit score. And if you have several applications in a short period of time, your credit rating may have a sharp decline. A mark gets put on your credit rating every time you get a credit check done. Most lenders will request a credit check every time you go through pre-approval and final approval. Which is why we avoid these with our specialised pre-qualification process.
Get Pre-Qualified for Bad Credit Car Loans
Loantec’s unique pre-qualification tool gives you all the information you’d get with pre-approval. But without the downsides of running a credit check. Learn how much you can borrow, so you’ll know what cars are in your price range.
Many lenders will dismiss your application as soon as they see your poor credit rating, but not at Loantec. We don’t prejudge your situation and we’ll work with you to get the car loan you need. No matter where your credit rating currently sits. When you work with us, bad credit scores will have less of an impact on car loans as compared to traditional lenders. Complete our pre-qualification form or call our Finance Technicians and start the process to get your new car today!