Buying a new car is not at all a big deal for some people, but for some it is an important changeover from one phase to another in their life. Do you belong to the second category? Are you planning to apply for an auto loan to buy a new car? Car financing can be very intimidating if you are new to it. Your car dealer may deceive you, if he finds you are new to this. Do you have a bad credit score? Don’t worry. You can still get a car loan, if you find the right financing agency.
Before getting a bad credit car loan you should know about the mistakes to be avoided. Avoiding mistakes will help you to avoid being ripped off.
Mistakes to be avoided
Being ignorant of credit score - Whatever is the finance you go for, your credit score plays an important role in deciding the interest rate. You should know about your current credit score to avoid being cheated by lenders. If they find out that you don’t know your credit score, you will be charged exorbitant rates of interest.
Being ignorant of the rates of interest - The rate of interest charged and the credit score are inversely proportional. The higher the credit score the lower will be the interest charged. Before applying for a bad credit auto loan you should research the interest rates charged by various lenders for similar credit score as yours. Researching in advance will decrease the risks of being cheated.
Not paying attention to the fine print in the contract - You should read the contract in detail. You should not ignore the words written in fine print. You should pay extra care to read the fine print. Use a magnifying lens if necessary and read the words in fine print carefully. If you have any doubts about the words written in fine print you should contact the lender immediately and have the doubts resolved before signing the contract.
Avoiding online lenders - It is not wise to avoid online auto loan lenders. Depending too much upon offline lenders can make you pay higher interests. You will be able to get bad credit car loan at a lower interest rate if you go for online lenders. Are you searching for an online bad credit auto loan agency in Canada? You should visit NewCarCanada.ca
Focusing on a specific vehicle - Keep a wide choice of vehicles. If you focus on a specific vehicle and limit your choices you may end up paying more interest.
Trusting the dealer too much - Your dealer may cheat you in many ways. He may ask for a co-signer if your credit score is bad. This will prevent the restoration of your credit because the loan will be in the name of the co-signer. He may call you after signing the deal to tell you that the financing fell through and that the interest rates have gone up.
If you choose the lender wisely and if you are flexible with the model of the car you want, getting bad credit auto loan is not going to be difficult.