Car Loans for Bad Credit
You’ve got bad credit and all dealers want money down. To get car loans for bad credit to purchase a car having no money down, you need to know a few things.
The most common reason a dealer wants money down is because it adds profit to the sale. The other not so common reason is because it’s wanted to lower the total amount the lender finances for approval. Trying to find out why they pressure you for cash is rather difficult so long as, you depend on the dealer to get you approved.
Most people with bad credit believe they have to use the financing the car dealership offers them. This is a common mistake that can cost you a lot of money in outrageous finance charges.
Everybody knows that car dealerships mark up the price of the car. Did you know that they mark up the interest rate as well? They submit your credit application to lenders. The lender gives them an offer. For example they approve you for a rate of 9%. The dealer, knowing that you know you have bad credit will try to persuade you that you are approved at 12%. The 3% difference is a profit that the finance manager gets paid a commission on. And you pay for it. Your payments go up 10, 20, 30, 50 or even $100.00 per month just because the dealership marked up the interest rate.
You can buy a car with bad credit without down payment and also with lower interest rates if you just avoid the dealer finance department altogether. If you know where to look and how to prearrange your financing then you walk into a dealership with confidence, pick out the car of your choice based on the amount the finance company preapproved you for and had the dealer a check. This gives a power of negotiating the deal.
