Need a new car but don’t have the cash to buy it outright? Well, you’re certainly not alone. Most people finance their cars in order to be able to afford to buy them. There are various options, available through a number of different lenders, but first you need to find out what your credit score is as that, plus your income, and this will determine what rate you will have to pay. Those with good credit will be able to obtain an auto loan with a lower interest rate, those with bad credit will be charged relatively high interest rates, but what if you fall under the fair credit bracket? Well, fair credit car loans should charge interest rates somewhere in the middle of the two.
First of all, what exactly does it mean if you have a fair credit profile? Those who find themselves labeled as having ‘fair credit’ will have a good credit history for the past two years, with perhaps an occasional late payment. If you have a mark against your name, but it was something that occurred a few years ago, the fact that you are improving your credit score and getting your finances back in order should stand you in good stead and help you to get approved for fair credit car loans.
For those with fair credit, car loans should be easily obtained. However, some lenders put those with fair credit in the same bracket as those with bad credit and offer them the same high interest rate. Sometimes the best course of action in these circumstances is to talk to the loan representatives – if you emphasize that your credit rating is not bad but fair, and prove to them that you are working hard to improve it by paying off outstanding debts, you may have a better chance of obtaining fair credit car loans with a lower interest rate.
Dealerships will often charge high interest rates to everyone that does not have a good credit score, so it’s worth looking into other options. So what are the institutions that provide fair credit car loans? Banks account for the majority of auto loans and, if you have a good, longstanding relationship with your bank manager, you may be able to negotiate a better interest rate. However, you don’t have to have an existing account at a bank to obtain a loan from them, so shop around the banks to figure out which one offers the lowest rate. This can take time though, and will not always prove fruitful, so an increasing number of consumers are switching on their computers and logging onto the Internet to search for the best fair credit car loans.
Many sites have loan calculators to enable you to work out the total cost of financing your vehicle and you can search nationwide establishments any time of the day or night. There are also several e-loan providers who only operate online, thereby saving them many overhead costs, which could in turn save you money. They can often provide you with a quote straight away
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