Not everybody has perfect credit. If you’re one of them, and you’ve been declined for an auto loan, you may feel like you need a second chance. Consider applying with a lender that accepts applications from consumers with all credit types, such as RoadLoans.
When you drive a new car off the lot, it’s perfect. The body is flawless, the paint is pristine, and the interior still has that great “new car” smell. But after you’ve driven the car for a couple of months — or a couple of years — you’ll notice that the shine has begun to wear off. There may be a few “door dings” from careless parkers. A scratch or two may have appeared on the paint. The interior might need an air freshener to make it more pleasant.
Your credit is the same way. Many people have trouble meeting all of their financial obligations from time to time. A late payment here, a repossession or other credit “oops” there — they add up. Pretty soon your credit has lost its new car smell, and suddenly you need a new vehicle.
Credit is all about risk. If someone has a history of not meeting all of his or her financial obligations 100 percent, that person is considered a credit risk. Many lenders won’t even talk to someone with credit that’s not considered “prime.”
But even people with credit that’s not perfect need to get around. Even people who have had credit troubles need to be able to commute back and forth from work and get the kids to and from school. Many people still need cars, and another chance to get financing.
That’s when it’s time to look for a finance company that accepts applications from people with bad credit* histories. There are auto lenders, including full-spectrum lenders and subprime lenders, which will gladly consider applications from consumers in these situations.
If approved, the interest rate you’ll pay when you have bad credit tends to be higher than if you had fair or good credit. This is to be expected, since the risk the lender is taking is higher. But in the end, the credit challenged customer may have a second chance to purchase the vehicle he or she needs.
Apply for a car loan to get an instant decision.
* “Bad” or “Poor” credit generally is considered a FICO score around 600 and below by sources including the Consumer Federation of America and National Credit Reporting Association (reported by the Associated Press), Bankrate.com, Credit.com, Investopedia, NerdWallet.com and others. The Congressional Budget Office identifies a FICO score of 620 as the “cutoff” for prime loans. FICO scores are not the sole factor in lending decisions by RoadLoans.com and Santander Consumer USA.