Here’s What You Need to Apply For Bad Credit Car Loans
You don’t need perfect credit to get an auto loan with a leading auto finance company. But that doesn’t mean you don’t need to be prepared. Applying is quick and easy, but if you take some time to think about your application first, you’ll set yourself up for future success and make it easier to pay off your loan with no hassle.
Borrower Application Profile Information
Asks our applicants, especially people with bad credit, for some basic information so we can get a better idea of who you are and what your goals are through the finance process, as well as your credit history, the loan term, and the loan amount you require. Be sure to have this information either in mind or on hand when you apply for a bad credit auto loan for a car in your price range or even auto refinancing. Providing accurate information helps us pair you with the right lender so take some time to think about answers to these questions if you don’t already have a response and make sure you can make the monthly payments. Filling out your application is quick and easy, even for people with bad credit—all you need is an Internet connection and the ability to visit our site through your web browser on a computer or mobile device. You can also use our app to fill out your application. You only need to apply once so be sure you have concrete answers to the various questions on your application before you submit.
What Kind of Vehicle Do You Want?
You don’t need to know the exact make and model, but you should have a general sense of whether you want a compact car, an SUV, a pickup truck, or something in the middle. Factors such as the color of the car aren’t as important as the general category into which the vehicle falls. We uses this information to find the right dealer partner for you to work with.
What’s Your Monthly Loan Payment Budget?
With any form of bad credit auto loan you need to know your exact monthly budget—not just an estimate—when you apply for bad auto credit loans. You’ll be asked to select a range on your application, but you should know your precise budget anyway. Whether you’re planning to spend less than $250 or more than $500 per month, it’s essential to know exactly what you can afford up front.
As you set your monthly budget, it’s best to err on the side of caution. Make sure it’s not an amount that you have to really stretch to afford. This way, you can avoid setting yourself up for further credit score damage and the pain of defaulting on a loan. Regardless of your circumstances, if you set a budget you know you’ll be able to meet on a monthly basis, you’ll have a great experience with your bad credit car loan and it can even help you improve your financial history through the consistent demonstration that you can and do pay bills on time. If possible, you might even want to try to save that monthly budget amount for a month or two prior to applying so you can have a reserve to draw from in an emergency and to ensure it’s an amount you’re actually comfortable with. This savings plan isn’t realistic if you need a car NOW, but if your current car is on its last legs though running safely and reliably for now, it might be a good idea to give short-term savings a try.
Basic Personal Information
Personal info, such as birth date, employment status, total monthly income, employer name and occupation, and home address are also part of the application for bad auto credit loans. There are specific reasons why each of these points of information is valuable for auto financing applications. For example, your monthly income demonstrates that your loan payment budget is realistic and in your price range. You’ll want to include income from all sources including spousal support, government assistance, salary, investment income and so on. You should also be able to say how long you’ve been receiving this income in weeks and months, which helps paint a complete financial picture. If you’ve been in your job for a while but recently fell on hard times, this information will help show that you have the means to act as a responsible borrower. Your home address helps lenders determine how suitable your budget is and how large the loan should be.
It can feel strange to get so personal on a financing application, but the more information you provide, the better a picture lenders can get of who you are and how trustworthy you are. Your credit score does not tell the whole story and if that’s what’s holding you back, you deserve a second chance. Providing a more complete picture of your financial health is a great way of showing that your credit score isn’t who you are. So, before you start your search for a car and test drive that little sports number of your dreams, before visiting the finance department to pay for it on your already maxed out credit cards (a very bad idea), you need to collate as much information about yourself first. If you’re asked to provide information such as your monthly income and your monthly budget for the car you want, it’s actually a good thing. Remember that these are car loans for bad credit so you need to be honest and make sure that you can afford the monthly payments. After all, it gives you that all-important second chance to show that your expectations are realistic and that you’re financially responsible.
An Understanding of the Lending Process
It’s important to understand what’s going to happen after you submit your application and if it’s accepted, after you sign a loan agreement. Firstly, if you have any questions at all regarding the application process, you should get in touch with the lending or financial partner organization you’re considering working with. Some financial partner organizations send client applications to a number of different lenders while others take some time to talk to the applicant first and then take that client’s application to a specific lender they know will make a good fit.
You should know which route your application will take after you submit it. You should also determine whether the company you’re considering working with is helpful and responsive. Getting in touch before you even submit an application provides a good idea of what it might be like to work with the same company in the future. If they won’t answer your questions now, there’s a good chance they’ll be similarly unhelpful in the future when it really matters.
It’s also important to be familiar with what exactly a car loan is. We’re not just talking about the basics here—you probably already know that the basic purpose of automotive financing is to provide funds for someone to borrow and slowly pay back over time with interest tacked on. Rather, you need to understand exactly what those basic facts mean in the context of the specific loan you choose. For example, it is essential that you understand the exact dollar amount of the loan you’re getting, the exact percentage of interest you’ll be charged and the precise amount of time in which you’re expected to repay the loan.
Furthermore, you need to know specifics, such as what your monthly payment is, whether there will be any additional fees such as a processing or late payment fee, and the date your payment is due every month. Make sure you understand everything about the loan, including whether interest rates can change during the course of the loan, the exact name of the institution that administers it and how you’ll be able to pay your monthly bill (can you pay online or setup autopay, is it necessary to pay with cash in person, etc.).
Also, be sure to understand what happens at the end of the loan term. Will you own the car, having paid it off in full? Does the loan amount only cover part of the cost of the car, meaning you won’t own it when you finish paying off the loan? You should know all of this BEFORE you sign the loan agreement and it’s not a bad idea to take some time—even if it’s just an hour—to consider whether you can really afford what you’re agreeing to pay for prior to finalizing the deal.
Doing all this will help you successfully pay off your loan as you’ll understand up front what it takes to avoid default and stay firmly on the road to credit recovery and a better life. The lender and your financial partner should be able to answer questions you have about these details and you should make a note of all of this information and compare it to what’s stated in writing on the loan agreement before signing.
A Reliable Financial Partner to Help You Find the Right Lender
As mentioned above, not all financial partners take the same approach to obtaining automotive financing for clients with bad credit. You should make sure to work with a partner organization that takes a more personal approach rather than just papering the town with your application. There are a few advantages to this approach. One, working directly with a financial partner to find just the right lender increases your chances of being accepted the very first time you apply. Financial partner organizations have direct relationships with lenders, which puts you at an advantage as you benefit from someone else's connections and expertise. Two, you avoid further damage to your credit score by undergoing multiple inquiries into your credit history by different lending institutions.
Also, as stated above, your financial partner should care about your financial security and genuinely want to help you get the funding you need. This means that all of the qualities listed above—transparency, helpfulness, willingness to clarify and explain details—should be part of your selection criteria as you consider which partner to work with.
It’s nice to work with a partner who really cares about you, but there’s another side to this that goes beyond security that you’re working with a good company. Financial partner organizations that care about their customers also tend to be more understanding about the circumstances that led to your current credit status. Trip's Auto understands that good people sometimes fall on hard times, but that doesn’t mean that doors should slam in your face automatically when you try to get a new car. Working with us means working with a company that looks at the whole picture of who you are, not just the number on a spreadsheet that gives a limited view of your financial responsibility.
Confidence and Hope for the Future
Applying for any sort of financing after being put through the credit wringer can feel hopeless. But we know that bad things sometimes happen to good people. Only the luckiest among us can sail through life without any stumbling blocks. Employment isn’t a guarantee and that can really send your finances into a tailspin. Whether you had to stop working due to a sick child or parent who requires round-the-clock care or experienced an unfair termination, our job status isn’t always in our control. We can also make mistakes with credit before we fully understand its impact. That doesn’t make you a bad person, but it’s hard to keep that in mind when you have a “bad” credit score staring you in the face.
As you rebuild your credit, chances are that you are taking a more informed and careful approach for your future. We understand that it takes time to rebuild credit and life doesn’t just wait around while you get your finances in order. Your car might break down or you could be a victim of a theft or an accident that suddenly robs you of a working vehicle. Most of us don’t have time to waste in this situation. Don’t let your credit hold you back. Get in touch with us and we’ll get you back on the road in no time.
Mainland Auto Loans blog is a free resource for credit challenge customers who have the desire to improve their lives by acquiring the knowledge required to increase their credit score. Our team understands that even good people are often forced to go through tough times. A divorce, a loss of income, an illness, or other similar circumstances out of your control might have put a toll on your credit history and your financial life. We want to help by giving you access to quality content that will provide you with the know-how, the tools, and the strategies to get back on your feet and enjoy the freedom of a healthy credit score.
Our writers specialise in automotive financing. To our knowledge, the purchase of the right vehicle, at the right price, financed from the right lender, at the right interest rate provides one of the fastest and most robust ways to rebuild your credit history. It’s impossible to erase bad credit, but rebuilding a solid and diligent payment history through a vehicle financing is a great way to separate yourself from your past credit bumps to enjoy a better future.
You can also use the information to protect your current credit, avoid pitfalls, and educate your children so they are prepared to enter the world equipped with the knowledge that will give them an edge and will allow them to fulfil all their dreams.
Credit is a great tool if used properly. At Mainland Auto Loans, we want you to control your credit; we don’t want credit to control you.