Poor Credit Auto Loans

by Mack Bartlett

You have bad credit, but you need transportation and your current clunker just isn’t getting the job done. You need poor credit auto loans, and you probably have several questions on your mind. Hopefully this article gives you some insight. You’re wondering ‘how much can I qualify for?’ ‘what interest rate will I pay?’ and ‘will my current debt load be a factor?’

I’m sure you can understand why there’s no clear answer to these questions. Quite a few different factors determine how much a lender will offer you. They include:

a. How bad your credit really is, because there are varying degrees of ‘poor credit.’ Have you been through a divorce? Was it an injury or illness that caused you to miss loan payments and consequently damage your credit? Did you unexpectedly lose your job? If the circumstances surrounding your drop in credit status were beyond your control, some lenders may be able to offer you auto loans for poor credit with special circumstances. After all, they’re going to treat you differently who just stopped making payments because they bought more car than they could afford, for example.

b. Your stable gross income, especially as it compares to your credit rating. If you earn a lot of money (say $75,000 per year or more), and you have bad credit, your chances are going to be better than if you have bad credit and low income. The higher your income, the less your credit matters. Lower income, the more your credit matters.

c. The total amount of your other debt, as well as your monthly payments. Most borrowers are accustomed to having lenders look at the new loan payment in addition to their existing payments, considering the total as a percentage of your income. If you total loan payments are more than 25% to 33% of your monthly income, and you already have poor credit, getting an auto loan will be tough.

Auto loans for poor credit are tricky business, but if you persist and shop several loan providers, you’ll get the loan you need to buy the car you want.

Related posts:

  1. Auto Loans for People with Poor Credit – Do You Need One?
  2. Auto Loans for People with Poor Credit and ‘Repos’
  3. Auto Refinance for Bad Credit
  4. Bad Credit Auto Loans after Repossession or Bankruptcy
  5. No Credit Auto Loans
  6. Low Interest Auto Loans

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