Car Loan – An Easy Access To Finance For Owning Dream Car

Owning a car of your dream is a reality these days. This is thanks mainly to car loan that is made available to each and every aspirant wishing to have a car of his own. The lenders have kept terms-conditions of car loans attractive for winning as many customers as possible in a tough car loan market, making the loan even easier to access. As per your requirements and as suits to your pocket, car loan is there for asking to buy either a new car or a used one. But before making a deal, it would be wise to have a close look of what is happening in car loan markets and what are basic aspects that one must be aware of in taking car loan.

One of the attractive feature of every car loan is that you do not have to look for a collateral is secured car loan is your option. it may be more beneficial if you can place any of your valuable assets like home as collateral with the lender. But if you do not like to risk home for the fear of its repossession, then the very car you intend to buy can easily secure the loan. all you have to do is to hand over the deal papers of the car to the lender who will return them after you have paid back the loan completely. In the meantime you can continue driving your car. But in case of payment default, you would be losing car to the lender.

Secured car loan have this advantage of lower interest rates and if your home secures the loan, the rate of interest goes down. The loan amount depends on equity in collateral like home or the price of the car. While you drive the car, the burden of the loan is lesser as the car loan can be repaid in 5 to 30 years. Larger repayment duration means you can reduced monthly payment towards installments.

Tenants or non-homeowners however can opt for unsecured car loan. Unsecured car loan comes without the clause of collateral, making the loan a completely risk free affair for the car owner. As there are risks for the lender, unsecured car loan come at higher interest rate making it costlier for the borrower. Unsecured car loan is solely offered on the basis of financial standing of tenants or non-homeowner. Income and employment documents are required from the borrower for ensuring safe return of the loan. you will be approved smaller amount for a shorter repayment duration as unsecured car loan.

Do not worry about bad credit. In case of secured car loan, as lenders have the borrower’s property as security, bad credit does not matters much to the lenders. For unsecured car loan however income and employment documents are must for showing to the lender. But bad credit borrowers will be approved the car loan at higher interest rate. At the same time one should note that if car loan installments are regularly cleared, the borrower’s credit score goes higher and loan availing in future becomes easier.

Buy a car from a reliable car dealer and check it for mechanical defects and quality. Compare different car loan providers who have showcased car loan interest rates and terms-conditions on websites. Apply to the suitable lender online for a fast processing and approval of car loan. Make sure to pay off loan installments in time for escaping debts.

Why to Get a Bad Credit Car Loan Now?

None Should Be Discriminated When Getting a Car

America is fascinated by cars and owning one gives a great amount of pleasure. To buy a car today, car loans are a pre-requirement. But, for a bad credit borrower, a car loan seems a distant dream. Do you have a poor credit score? Is getting an auto loan difficult for you? Are lenders constantly rejecting your vehicle loan application?

Well, if the answer is yes to all the questions, this article can help you get an auto loan even with bad credit. In fact, after reading this piece of writing, you will understand why this is the best time to acquire a bad credit car loan to buy your dream car.

Here’s Why Getting a Bad Credit Car Loan Is Easier than You Think

Upswing In Vehicle Sales

7.3million- That’s the total number of vehicles sold in the first half year of 2012! There has been a 14.8 percent rise in car sales since last year. This sale can be attributed to many factors like car manufacturers are pushing for car sales. Even European auto makers consider the American market profitable. They are vying for higher sales in America because of problems in their economy. With this new development, you can get newer car models and better incentive programs. Also, easy flow of credit has played a major role.

Lowest Delinquency Rates

The delinquency rate is the percentage of auto loans that have not been paid by the borrowers. TransUnion in its first quarterly report of 2012 mentioned that auto loan delinquencies are down to 0.36 percent which is very less compared to 0.46 percent – the fourth quarter result of 2011. These figures have proved that borrowers are more serious and diligent in making regular payments.

TransUnion also mentioned that there is a rise in lending as well as leasing in the non-prime risk segment. With low delinquency rates, lenders are able to put more trust in the equation. They have now understood that people will definitely make payments. When the overall mood is positive, getting a bad credit car loan becomes easier.

Investors’ Trust

Investors are buying securities made up of car loans as they are comparatively safe and profitable. They fare better than home loans because cars are major requirement for us. We may give our home but a car is necessary for our employment. This makes them a safe bet. The recent example of this is how companies like GM Financial, Santander Consumer USA and other lenders have issued $ 10 billion of sub-prime car loan related ABS. This is a 20% jump from last year.

This deal proves that auto lenders will now be offering more poor credit car financing options because it has become a lucrative option for them. They can easily bundle-up your loan as securities and earn from it. So, auto financing companies are now taking risks in offering sub-prime credit auto loans.

All these factors lead to one conclusion that lenders are now interested in providing you bad credit car financing. It is no longer difficult to secure a loan. It is not difficult to buy your dream car anymore!

Are You READY For A Bad Credit Car Loan?

Before getting a car loan for people with bad credit, you must consider these important points so that you don’t doubt your decision later.

1. It’s important that you choose an inexpensive yet efficient automobile. A used car is the most affordable option with you. It is a perfect choice because its depreciation rate is lower than new cars. While choosing a car, don’t forget to check its title. Get it inspected from your trusted mechanic.

2. If this is your first loan after your score nosedived, you must be ready to pay a higher interest rate.

3. Choose a shorter auto loan term so that you don’t increase any chance of an upside down auto loan.

4. Regular payments are extremely necessary to improve your credit score and to avoid it from further deterioration. If you make on-time payments, you will get better interest rates next time.

5. Most lenders have lock-in period during which you cannot refinance or trade-in your car. This is usually the first six months or the first year of the loan term. So, don’t choose any car loan that makes you uncomfortable because you will be stuck with it for some time. Take time to analyze and select a bad credit car loan quote.

These significant cues are very crucial in reaching a good decision. You must understand that bad credit auto loans are easily available but you can make them more comfortable by remembering these points.

Now that you know how easy it is to get a bad credit car loan, don’t wait anymore. Once you consider all the points mentioned in the above paragraph, you must embark on the journey of regaining your old good credit.

Top 5 Reasons to Avoid Car Loans

In the olden days, owning a car was considered as a part of luxury. But the modern circumstances have gone far from that stage. Today, car has become an inevitable part of a lifestyle and most families now have 2 or more cars. The car can be a necessity in the modern condition but the cost for it is not affordable for everyone. Majority of the car loan companies have come up with easy installment car loans as a possible method to arrange the money for car purchase. However, the car loans are not appreciated to be beneficial at all times.

The primary reason behind the discontent of the experts about car loans is the risk involved in it. Car loans are available in secured and unsecured options. However in most cases car loans are provided on the collateral security of the car itself. In most cases the collateral value will retains its value more or less during the whole loan repayment period. But, in case of car loans the collateral value will be depreciating at higher rates and it won’t be viable to support the loan during the whole loan process. The car loan lenders are forced to compensate their risk by including stringent conditions. This will reflect a practical difficulty, ultimately on the borrowers. And, in effect the car loans will not be advantageous.

Now many options are available for car financing. In most cases the dealers of the car itself will offer the financing of the car loan. Many banks and other private banks are also present in the market. Even then, the rates of car loan are higher than any other secured loans. In several cases unsecured loans are available as car loans. In the case of unsecured loans, the interest rates will be higher than any such loans. If the person has credit liability, the burden of the interest rates will increase in the car loans.

The repayment term of the car loan will also be a problem, as it will be short due to the risk involved in the loan. As the value of car decreases with the time, the lenders will be interested to limit the repayment schedule to as minimum as possible. The high interest and limited repayment track will in effect increases the monthly repayment amount.

In the present scenario, we are forced to change the car, according to the latest trends in the car market. The modern motor vehicle industry has come up with many attractive models that will gain the attention of people. The selling or exchanging of the car will become a problem, if you have a big balance in the car loan repayment. You will not be able to find appropriate deals as most of the people will not feel good to take up the loan associated with it.

Car loan refinancing is a popular option to reduce the hassles involved in car loans. But the efficacy of the car loan refinancing is also a question. Any faults in the repayment will also affect your credit score. In brief, car loans are potential dangers, which can imbalance your financial stability. It will be better to arrange the finance from any other source. And if car loan is inevitable, analyze the terms of the car loans carefully, before stepping in.