How Auto Financing Companies For Bad Credit Operate
Posted on: 3 April 2017
If you are stuck in a difficult position of needing a car and not being able to finance it, you could try an auto financing company for bad credit. These companies operate in a few different ways, which help a lot of people in similar positions get a car. Here are some of the more common ways in which auto financing companies for bad credit operate.
References, References, References
One approach that a bad credit auto financier uses requires several personal references. Some may ask for a dozen references before they will even look at your application, while others want about a half dozen. These references have to be people who know you really well and who can relay information regarding your whereabouts and your telephone number in the event that you miss a payment and the financier is trying to reach you. The information provided acts as a call list of contacts to help locate you and make contact with you.
Employment History, Proof of Employment, and Paycheck Deposits
Other bad credit auto financiers use this approach. They require a complete employment history that shows that you have a job, you show up to work on time, you have been with the same employer for longer than six months to a year, and you have regular paycheck deposits into a checking account. Using this information, the financier may request that weekly, biweekly, semi-monthly, or monthly payments be taken directly out of your checking account to pay back your auto loan.
Required Weekly Payments, No Exceptions
If your credit is especially bad, you may still get a car loan. However, you may only qualify under this type of program, which requires weekly payments, no exceptions. These terms are a little more strict and are often enforceable via repossession of your vehicle. If you are someone who can budget well and pay your bills on time, and it is a series of other factors that have given you bad credit, this may be a good option for you. The weekly, on-time payments will reflect on your credit reports and help you rebuild your credit. After a couple of years of paying back your car loan this way, you may be able to refinance under a more traditional car loan program.
The Co-Signer
Lastly, a co-signer who has good credit may be able to help you. Auto financing for bad credit may be offered at the dealership but only if you have a co-signer who is willing to assume responsibility for the payments needed for your vehicle. If you are married, this is not typically a problem.
For more info, talk to a representative of an auto financing company for bad credit.
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