Earlier if credit history of a person was not good than they have to face lots of problem in obtaining a car loan. As most of the nationalized banks and financial institutions are not willing to finance cars for those less than perfect credit.
Owning a car is very important for people nowadays as it has become a necessity. Because of this credit card loans are available for people with bad credit history. Ones needs to take care of certain points while taking this type of loan such as giving a large down payment, approaching the same bank from where you have already taken an earlier loan, finding a co-signer with a good credit history to back you if things go wrong and also take the help of bad credit card loan consolidation services.
'Opportunity' is something which is found everywhere in present times be it career wise, on the personal front or financial terms. When it comes to finding that perfect car for yourself, it is extremely important to analyse the pros and cons and then reach a decision especially if you are someone with a bad credit history. Usually car loans for people having bad credit is easily available nowadays, still certain points need to be taken care of by people who desperately want that bad credit car loan. Online car loans for people having bad credit are available to people who have defaulted in their payments, or filed for bankruptcy or those who are in arrears.
You must be wondering how bad credit or ones credit worthiness is calculated. It is calculated based on the person's payment history, amount owed, and period of credit history, new credit and types of credit used. Based on these factors the credit score of a person is calculated. Your credit score is calculated by credit reporting agencies or bureaus by comparing your credit history with a general average credit history. Around 30% of your credit history will be determined by how many issues you have on your credit report such as bankruptcies or dormant accounts, around 35% credit history will be determined by the past 2 years payment history and your credit score will suffer a setback if you are regularly late with your payments, around 10% will be determined by the number of credit request you have applied for from many sources simultaneously.
If we compare two credit ratings, then the one with the higher credit rating will be able to save more on the loan amount than someone with a bad credit score. Credit car loans for people with bad credit can be divided into two types, secured and unsecured.
Secured bad credit card loans: A situation where loan is been offered to a person in lieu of a security is termed as secured bad credit card loan.
Unsecured bad credit card loan: This is a situation wherein a person is given loan without an obligation to offer any security. In these types of loans, the interest rate charged is higher as there is no security.
Features of a bad credit card loan:
•This loan can be applied for both new and used cars.
•Provision of secured as well as unsecured loan is available.
•You can opt for the best terms after analysing your repayment ability, financial status and requirement.
•If you opt for online car loans, then you will be able to utilize tools like loan calculator and receive quotes before deciding on the type of loan they want especially because they are the ones with bad credit, so they need to be even more careful.
Author is regular writer on CarMoneyFast.com
, a US based portal, which provides detailed information on car loans with bad credit
or credit history.