Bad Credit Car Loan Tips for Consumers

By: Shelly Evans

You have just received a response from an auto loan company that your application has been declined.  According to the lending officer, your loan proposal has been rejected because of your bad credit history or low credit score. The lending company you submitted your car loan application to only accepts customers with good credit rating and obviously, you did not meet the lender’s criteria. What can you do?

Subprime Car Loans for People with Bad Credit

If your credit score is below average, then you fall into the subprime category. Does that mean you cannot get the car financing you need? Not at all! Many lending companies in the market do offer financing for the subprime market or consumers who are credit challenged. Even with bad credit, you can still get approved for a car loan but you need to find the right lender.

Do subprime car loans mean high rates and fees? Because of the greater risk involved, lenders may charge a little more on interest rate for this type of loan. But that does not mean you should settle for an unreasonably high rate or unfair terms. Even though you need to improve your personal credit score, you still deserve fair treatment.

Bad Credit Car Loan Tips for Consumers

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2 comments

  • The Prudent Planner says:

    What are some examples of subprime loans? If the average loan on a new car for 72 months is say around 8%, would a subprime rate be as high as 12% or lower possibly?

  • Allison May says:

    Yes, rates on subprime car loans can go up above 18%! It all depends on the persons situation.

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