Bad Credit Car Loans

Interest rates cover the gamut from 15% to 30% depending on your credit history. In some states there is a cap or “usury” law that limits the amount of interest charged on a loan. Nevada has no such law. Additionally, banks are allowed to charge a service fee to acquire the loan. The costs are typically $295.00 to $1500.00. Dealerships have no control over the bank’s decision, although the more banks the dealer has relationships with, the better chance you have of getting the right financing package.

A bank representative will call you to verify all the information provided is correct, before the final approval is given. When questioned; be pleasant and answer honestly. This is another area where attitude has considerable impact on the loan approval process. Misrepresentations are considered illegal acts, punishable under the law.

Picking the vehicle. The dealership must match the buyer, the car, the bank, and the down payment to make the loan happen. It is not easy to get these deals financed and it is not always on the car you envisioned yourself owning. The older, high mile model is not the means to a lower payment. The dealership will suggest vehicles in a certain price range based on your credit situation and monthly income: typically, 15% of you gross monthly income as a model auto loan payment. Select a model you will not outgrow in a few years. DO NOT pick the biggest, baddest vehicle on the lot because the payments you make will not keep up with the depreciating value of the vehicle. Over time you will feel too much pressure from the payment and will want to “dump” the vehicle, resulting in more damage to your credit. Buy the big, fancy model when you have achieved you goal of a superior credit rating resulting in the lowest possible interest rate. For the first step to credit recovery, select a modest, mid-priced vehicle that suits your needs. Drive the vehicle. Check the service history. Ask about the remaining factory warranty and if the vehicle is certified. A Certified vehicle means the manufacturer has provided additional warranty coverage at a reduced price to help sell the off-lease and returned rental models one or two years old. If no certification is available for the car you selected, purchase an extended service contract from a major manufacturer; GM, Chrysler, Ford. Make sure the coverage is appropriate for the vehicle.

Taking delivery. The dealership personnel will want you to take the vehicle home that day.