In today’s economy, thousands of Canadians suffer from bad credit due to foreclosures, bankruptcies, liens and / or loss of employment. Due to the amount of bad mortgage loans, banks are making it harder for people to get a loan. Its guidelines are stricter than ever.
If you have bad credit then how to get approved for a car loan? First, let me say that each bank or lender has its own score to determine if you are a high risk borrower. Subprime: the person fit into this category if he or she has less than a 620 credit score.
If indeed you are a high risk borrower, does not mean you can not get a car loan bad credit. Most banks are willing to provide people with bad credit because they are making money with steep interest rates to be charged. Although interest rates may be high, this is an opportunity for you to get a new car or used to try to rebuild your credit score.
Before turning to a car loan, be sure to call around to other banks to check their loan rates. All bank rates are different. It can be a quarter, half, or more than one percent difference. Even a quarter percent difference can save you money over the life of the car loan.
After years of paying your auto loan bad credit on time, check your credit score to see if you can refinance your loan in a loan interest rate low. You probably can improve your credit score in two or three years if you pay all your bills on time.