Some of us have bad credit and this will affect if you want to get a car loan. However, if you meet certain criteria, you can still get auto loans even with your bad credit standing. We will present here the definition of this type of loan and will lead you to how you can get it.
Let us answer the question first on what is this auto loan for bad credit. An auto loan is for those individuals who are finding it difficult to get a loan through the traditional ways.
You can get a bad credit auto loan if you have the following condition, like you have a low credit score, you have filed for bankruptcy, you have a low income bracket, you have no money to deposit for a car, and had a car repossessed in the past.
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However, know also that getting a bad credit auto loan would be disapprove if you do not have a job that is permanent and only a part time one, if you cannot present proof of income, and if you had repossession lately.
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There are basic qualifiers for you to get a bad credit auto loan, and these are that you must be at least 18 years of age, have a $1,500 minimum monthly income, at present residing in the U.S. and are a citizen, and you have employed full time with a fixed salary that can cover payment for the loan term. Other requirements would be a working phone number and proof of residency that can be presented using a utility bill or a credit card statement.
Depending on some circumstances, you are asked to demonstrate proof of your income in a bad credit loan. For example, you can show the lender of your payment slip if you are employed, or your past tax return to validate your income. For those who are self employed, you are still asked for a proof of income and you can do this by gathering your tax returns at least in the past three years, and this can be done by getting a professional tax preparer showing a form with profits you made.
Usually, in assisting funding for a car loan, dealers will look at the age of the car, and their cut off is seven years old.
Know that your bad credit auto loan will be best done through a franchised dealer since they have a good reputation of this situation. When your loan is already funded by this dealer, they would later assign your loan to a finance company. Be informed also that if you buy your car from a so called buy here/pay here car dealer, a third party payment processor will usually service your loan.