Having bad credit can make life pretty difficult, especially when it comes to making expensive investments such as cars. A few poor financial decisions shouldn’t mean that consumers have to simply accept their fates and take public transportation forever, though. Read on to find out about a few options and financing tips for drivers with bad credit who are interested in purchasing cars.
Determining a Budget
Those who are struggling to get their credit scores back on track can’t afford to overestimate their spending abilities. Make sure to set a realistic budget for monthly payments prior to speaking with dealers or lenders and to save up as much as possible for a down payment in order to keep those car payments as low as possible. By ensuring that they are able to make their monthly payments without trouble, drivers with poor credit histories can not only get the cars they need to expand their work options, take the kids to school, or make running errands much easier but can also improve their credit over time.
Don’t Buy a Lemon
It may be tempting for readers to take what money they have and invest it in a cheap old car that seems like a deal that’s too good to be true. While it’s possible to find cars for sometimes less than $1,000 online through private sellers or on the lots of disreputable used car salesmen, these cars are almost always bad purchases as they’re very likely to break down almost immediately. It makes more sense to look for a used car that’s newer and in better condition and simply make payments on it than it does to shell out every penny readers have for a rust bucket that likely won’t survive the year.
Do Some Research
While some lenders refuse to work with borrowers who have less-than-perfect credit scores, others offer sub-prime loans exclusively. Consumer Portfolio Services specializes in providing indirect auto financing, meaning that they purchase sales contracts from dealerships and service their contracts, so finding a dealer who works with this company or another one like it can be extremely helpful. There’s no reason any driver should resort to buying a rust bucket that will only last a month when they could work with a specialty finance company to buy a high-quality, late model used car.