Tips On Buying A Car With Bad Credit

If you have previous credit problems on your record and need to purchase a car, you may need to apply for what is called a bad credit used car loan. A bad credit used car loan will allow you to purchase a vehicle, but you will usually be expected to pay it off in a shorter time frame and at a higher rate of interest.

Today many traditional car lenders are offering extended payment terms; some allow you up to seven years to pay off the vehicle. A bad credit used car loan usually must be repaid within a 48-month time frame. Since the vehicle you are buying is used and your amount financed will be less, the lender expects the loan to be paid off in a shorter amount of time.

Research the Prices of Used Cars

Before making an offer on a used car, you should research the average price value. By doing this you will know if a dealer has inflated the price in order to make an excessive profit. You will want to make sure you are purchasing the car from a reputable dealership.

There are a lot of companies who do most of their business with customers who have less than perfect credit scores. Some of these dealers may try to take advantage of customers. Just because you have had credit problems in the past, this does not mean you should pay an outrageous amount in interest rates or other fees.

Shop Online For a Lender

Online auto loan lenders make applying for a loan quick and convenient. By applying online you will have access to several lenders and their rates. Applications for online auto loans can be filled out in just a short time and the approval is almost always granted the same day.

An important point to remember when applying for a used car loan on bad credit is that banks have limits to how old of a vehicle you can purchase. The majority of banks will not grant loans to vehicles more than four or five years old. You should also try to make a substantial down payment when purchasing a used car. This will lower both the interest rate you are charged and the length of the loan.

Should You Buy A Used or New Car

It is a fact of life that many people need adequate forms of transportation to commute to and from their jobs. If you are like most people, your car is one of the largest expenses you will have next to your house. In all the research I’ve done on personal finance, how you go about purchasing an automobile can have a large impact on your credit and financial picture. If you go about purchasing a car the wrong way, it can put you in a financial strain which will be difficult to recover from.

Can You Afford It?

As of this writing, the average American makes about $33,000 per year. Most brand new cars cost well over $12,000. This means that the cost of a brand new automobile makes up a large percentage of the annual income made by most Americans each year. Most people cannot afford to pay $14,000 up front for a brand new car, so many choose to get car loans. When you take into consideration the interest that must be paid, it can take as long as 7 years for the average worker to pay off this loan. At the same time, the car will depreciate in value, and will be worth very little once it is paid off compared to its original value.

Job Security

It is also important to remember that most people don’t keep their jobs for seven years. Many people, especially those that are young adults, may work multiple jobs within a single year. This shows a lack of stability, and it is easy to get into a financial strain if the economy suddenly experiences a downturn and jobs become harder to find. It is for this reason that you should avoid car loans and consider buying used vehicles instead. There are many advantages to buying a used car instead of a new one.

Benefits of Getting Used

Used cars tend to be much cheaper than brand new cars. Because of this, they are easier to save money for. They will often be sold by private owners instead of a company, and the owner is likely to be much more flexible. You save money because you are purchasing a car at a wholesale price. Unlike a car loan, you won’t have to pay interest when purchasing a used car. At the same time, there are some disadvantages to buying a used car. Used cars will often have a large number of miles on them, and are much more likely to break down faster than new cars. This could leave you having to make costly repairs.

Can’t Addon

Used cars don’t have the options that you will get with new cars. The color and other accessories can’t be chosen, and what you see is what you get. While there is little you can do about this, you can have a mechanic check the used car prior to buying it to make sure there are no mechanical problems. If the transmission goes out, it could cost you well over $1000 to get it fixed, and this could put you into a financial strain. You should buy quality used cars from companies which have a reputation for making good vehicles.

Pay the True Value, Not What You Are Told

You should also check the bluebook value on any used car you’re interested in to make sure the price the owner is asking isn’t too high. If the bluebook value on a specific car is $3,000, don’t buy it from an owner who asks for $4000 unless there is a good reason to do so. Car loans should be avoided at all costs unless you have a stable job, a high income, or a large amount of savings.

What Your Cars Smell May Be Telling You

What is the usual smell that your car has?

For most cars the usual smell would be the scent of leather or of the materials used. This usually goes for those newly purchased cars. On the other hand, there are also distinct smells that emanate from your car as it goes through time and use. However, as the owner or driver, you would know that these are the usual odors and that would not be something to get alarmed about.

What you should be on the alert about are some types of smells or odors that seem to be different, and out of the ordinary. These are the smells that you should be aware about, for they could conceal something much more serious than simply a smell out of place.

If you smell an odor emanating from your exhaust, it could indicate that there is a leak in the exhaust system. It could mean a hole in your carís tailpipe, exhaust pipe, exhaust manifold, or even the muffler. It could also mean that your hatchback or rear door already has a worn out seal. If this happens, you should take on the challenge immediately for you might get carbon monoxide inside your car which could get pretty deadly. What you should do is to bring your car to a mechanic right away.

If you smell raw gas, it could mean that there is a leak in your carís fuel delivery system. What could be affected is your carís fuel lines, gas tank, or your fuel filter. This is also dangerous for any fuel leaks could spark a car fire. You can remedy the situation by first seeking if you have put back the gas cap right on properly. If this does not seem to be the problem, then go straight away to your mechanic.

The smell of rotten eggs could also be something that you may notice and this means that your catalytic converter has become plugged. Once you smell this, go see your mechanic so as to remedy the problem.

When Should You Buy Or Lease A Car?

It is the classic dilemma that faces every auto-consumer out there, Pay
cash up front or forego the ownership and pay monthly settlements instead? As is the case with every other common dilemma, there is no slam-dunk answer. Each option has its own benefits and drawbacks, and it all depends on a set of financial and personal considerations.

First, your finances. Affordability is clearly key, and you need to ask the
question of how stable is your job and how healthy is your general financial situation. The short-term monthly cost of leasing is significantly lower than the monthly payments when buying: you only pay for
the portion of the vehicle cost that you use up during the time you drive it.
If you have a lot of cash upfront, then you can opt to pay the down
payment, sales taxes – in cash or rolled into a loan – and the interest
rate determined by your loan company. Buying effectively gives you
ownership of the car and that feeling of ìfree drivingî that goes on
providing transportation.
If, say, you want to get into luxury models but can’t afford the upfront cash of purchasing the vehicle than youíre a good candidate for leasing.
Unlike buying, it gives you the option of not having to fork out the down payment up front, leaving you to pay a lower money factor that is generally similar to the interest rate on a financing loan. However, these benefits have a price: terminating a lease early or defaulting on your monthly lease payments will result in stiff financial penalties and can ruin your credit. You need to make sure you carve out the monthly lease payment in your budget for the foreseeable future, at least for the duration of the lease.

Besides the financial aspect, making a buy or lease decision depends on
your own particular lifestyle choices and preferences. Think about what the car means to you: are you the sort of person to bond with the car or would you rather have the excitement of something new? If you want to drive a car for more than fives years, negotiate carefully and buy the car you like. If on the other hand, you donít like the idea of ownership and prefer to drive a new car every two to three years then you should lease.
Next, factor your transportation needs: How many miles do you drive a year?
How properly do you maintain your cars? If you answer is: ìI drive 40,000
miles a year and I donít really care much about my cars as I don’t mind dealing with repair billsî, then youíre probably better off buying. Leasing is based on the assumption of limited-mileage, usually no more than 12,000 to 15,000 miles a year, and wear-and-tear considerations. Unless you can keep within the prescribed mileage limits and keep the car in a good condition at the end of your lease, you might incur hefty end-of-lease costs.

Advantages Of Online Auto Loan Applications

 

In the current market, there are several ways for one to get help in paying for a nice, personal vehicle. Banks, dealerships, financing groups, and, nowadays, even the Internet have gotten in on the act. However, there is an emerging increase in online auto loan applications, likely due to the reputed convenience and speed by which these institutions are characterized. These online auto loan applications websites can be very competitive with one another, as well as with their real-world counterparts. As such, it is not unusual for them to offer competitive rates and terms that are easier on the pocket that a bank or car dealership would.

In previous years, a history of bad credit, declarations of bankruptcy, and default on loans meant that a person was not fit to be given money or be approved for any sort of financing deal. While this still holds true at the core, several online auto loan applications specialists have found ways to work around those limitations. The blatant disregard for past credit history is currently not the standard by which the industry works but it is becoming a trend among the websites that have decided to specialize in the car financing field.

Previously, getting a financing deal approved was seen as both an activity which took up too much time and was far too complicated a procedure. However, with online auto loan applications, the process has become faster. Online lenders can easily check into an applicant’s financial history, based on the information provided to them on the applications on the company’s websites. After a few minutes of checking, these online lending organizations can easily determine whether or not one’s credit rating is acceptable enough for them to loan the money needed to get that car the buyer is interested in. The online environment also makes it faster for these online financing groups to actually transfer the money to the buyer, making the time between the application and the buyer receiving the money far shorter.

Another bonus is that online auto loan applications tend to have lower interest rates than a bank or a real world equivalent. These rates are results of the drive for competition between these online lending companies, as well as competition with banks, dealerships, and real world lending organizations. While the tendency to vary interest rates has currently been adopted by online lending groups, it is not as widespread as it is in car dealerships. However, the interest rates and the terms of the loan are all determined primarily by two factors. The first factor is the potential buyer’s credit rating. The second factor would be the actual amount that the buyer is actually asking for.

While by no means perfect, online auto loan applications are fast becoming the norm for people who are intent on purchasing a car, be it used or new. As with their real world counterparts, knowing one’s credit score is essential in successfully completing one’s online auto loan applications. There are also some risks involved, even though most websites have taken security measures to make sure that no identity theft is made. That does not mean the consumer can be lax in preventing such theft on their end, however. Regardless of the risks, the benefits of convenience, speed, and flexibility offered by the online lending companies are far more tempting than the prospect of having to drive over to an office and discuss things, only to end up feeling as if one’s time was wasted.