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Car Loans for Bad Credit Easier to Get

Posted on Dec 17, 2012 by Thalia Green
Dec 17

Bad credit car loansIf you have less than perfect credit and have been wanting to purchase a new or used car, this may be the ideal time to start shopping! According to an Experian Automotive report, the sales of new and used cars to customers getting subprime loans has increased.

Subprime loans to customers purchasing new cars increased during Q3. This puts these loans at 25% of loans for all new cars. Used car loans at subprime rates are on the rise, becoming over 54% of the loans made for used cars.

As the economy continues to change, consumers are becoming more willing to make large purchases. Lenders are willing to take on a little more risk by approving more subprime loans. The affect of all this is that the new and used car market is open to more consumers.

While the market is far off from where it was a few years ago, changes in lending trends are helping to get more people into new and used cars. The credit scores required for new and used car purchases are lower than this same time last year. There is also an increase in the amount of money approved for both new and used car loans.

Some of these increases are due to changes in spending habits. Late car loan payments and repossessions have both gone down. The goal of lenders is to move auto inventory and to do that they need customers. When there are reasons for lenders to be more positive about the market, they will extend the subprime loans to more people, generating more sales.

The availability of new and used cars to consumers with subprime credit is still influenced by the brand and model. For example, Lexus and Lincoln require a higher credit score to get you into a new car versus a Dodge or Chrysler product, which only require the lowest scores.

With a little research on brands and subprime lenders, this could be the time for you to show your consumer confidence by purchasing a new or used car.

Why Would I Want A Cosigner for a Car Loan?

Posted on Oct 04, 2011 by Thalia Green
Oct 04

Are you unfamiliar with the concept of a cosigner? A cosigner is someone who agrees to sign off on a car loan with you. In addition to your credit history, the lender will also take into consideration the credit history of the cosigner. If the cosigner's credit history is good, it can act as a trump card on the loan application, moving it to the top of the stack. Obviously if you have someone who is willing to cosign for you, it would be a favorable option. Here are some situations in which having a cosigner is a good option.


Bad Credit
Bad credit can happen for all kinds of reasons. Some are as a direct result of your actions, others are outside of your power. For example, identity theft can wreak havoc on your credit report, and can sometimes take weeks or months to undo the damage. In the mean time, you might need an auto loan so you have a means of transportation. But acquiring one with a cosigner could be a great option. If you are otherwise responsible, a cosigner might be willing to take on partial responsibility for your car loan. In time, as you get your credit cleaned up, you might be able to take on the loan exclusively. The cosigner can be a temporary solution to identity theft.


No Credit
College students who are just starting out have no credit history to speak of. They will almost certainly need the help of a cosigner. In this scenario, it's usually a parent who acts a cosigner, while the student makes regular payments on the loan. Over time, the student will build their own credit history, and after a period they might be ready to take on full responsibility of the loan.


Regardless of the reason for the loan, open lines of communication are crucial. Trust between the cosigner and the buyer must be maintained. If you are taking the initiative to seek out help from a cosigner, you should offer also to give the cosigner access to view your bank statements and other financial records. An agreement should also be made as to the consequences of defaulting on the loan. Payments for the loan should be made a top priority, one of the first things that you should pay when your paycheck comes in. Your goal should be to eventually take over complete responsibility for the loan.

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