Many customers who are trying to purchase a vehicle are finding that there is a significant lack in financing options for people who have bad credit. This is especially true when trying to secure a bad credit auto loan from a local or national bank for a private party purchase. Even with the guidance of a loan officer, many people end up applying for a personal loan, rather than an auto loan, when trying to purchase. This is because a personal loan, it doesn’t require as much legwork. To apply for a personal loan, you don’t have to know the exact vehicle you are going to buy.

A personal loan sounds like a really good idea, you can get cash, and then find the car you want to drive that is within your new budget. However, if you have bad credit, the banks are going to be much more reluctant to extend credit in fear of the loan becoming default. If the loan defaults, there is no lien on the vehicle; there is no protection on the banks end that they may be able to salvage part of their loss if the loan does end up defaulting.

When you purchase a vehicle from a dealership, the process is much more streamlined. The banks are more comfortable, they know what car you are getting, and their name is attached to the car, so you both own it together until you pay off the loan. If something happens to the vehicle, many vehicles have a warranty through the dealership. That’s just one more added piece of protection for a bank. If you buy a car from a private party, and it breaks, no warranty, you are stuck with a car that doesn’t run. This is a situation that banks worry about when lending money for vehicles. They have sadly learned from experience that if someone can’t afford to pay to have their vehicle fixed, then they don’t want to continue to pay for something that doesn’t work.

There are a plethora of dealerships across the United States, both domestic, import, and a mixture of used that have separate finance departments for people with bad credit. Working with a dealerships special finance department can be the fastest way to get you into a vehicle if you are trying to buy a car with bad credit. There are sites, such as http://carcredit.com that can help assist you find a dealership in your area that specializes in sub prime financing. This means that in most cases, that they are able to help people with little credit, no credit, and bad credit.

Remember, before you sign any papers, and decide on that final monthly payment, that you need to take a serious look your finances and do not take out a loan that you will not be able to afford. There are added expenses, such as insurance, and maintenance that are not included, and are required when purchasing a vehicle, remember to factor those numbers into your monthly expenses when deciding what you can afford.

Magnus Larsen is a staff writer for NatLeads, inc specializing in auto loans http://www.afterbk.com delivering quality car loans for ten years The webs best Bad Credit Auto Loans

Magnus Larsen is a staff writer for NatLeads, inc http://www.afterbk.com http://www.easybadcreditcarloan.info http://easycarloansforbadcredit.info

Author Bio: Magnus Larsen is a staff writer for NatLeads, inc specializing in auto loans http://www.afterbk.com delivering quality car loans for ten years The webs best Bad Credit Auto Loans

Category: Finances
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