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Posts Tagged ‘Guaranteed Car Finance’

Most of the auto loan lenders have set some minimum eligibility criteria. If you meet the same, you can easily avail guaranteed car finance. Most people have the misconception that having a good credit score is one of the criteria that is mandatory. True that many lenders prefer borrowers with a good credit history. But you will be happy to know that even if you have a poor or bad credit score, you can still find a good financing solution to purchase your dream car in the form of a no credit auto loan. These are the schemes that have been specially designed for people with bad or poor credit history. In this financing process, the lenders do not check your credit score. Let me give you brief insight into some of the important components of the eligibility criteria for guaranteed car loan.

Employment Record

Since you do not have a good credit history, it is important for you to have a good employment record. Every lender wants his money back and they look for some kind of assurance. In this case, a good employment record can easily assure the lenders that you are capable of repaying the bad credit auto loans in a timely manner. You will be asked to submit documents in proof of your employment status. Your current job must be at least 6 months old and you must have an overall work experience of three years. What is more, the amount of your monthly income also plays an important role in getting the guaranteed car finance approved to you.

Bank Statement

The lenders will also ask you to submit the bank statement showing transactions for at least the last six months. It has been found that lenders prefer those who have a salary account in their name. Those who have a salary account in their name can easily get low interest auto loan, that too, at the lowest rate possible.

Down Payment

Making a higher amount of down payment will also make it easier for you to get the auto financing at a much lower rate. In general, it is mandatory for you to make a down payment of at least 5%-10% of the total amount. If you willingly pay 15%-25% of down payment, you simply improve your negotiation power to get guaranteed car finance at the best possible rate.

Don’t you always wonder how you can guarantee someone finance? The word guaranteed is very strong and you will not use it in every day scenario. Most guaranteed car finance or personal loans companies will have a promise along those lines. We can promise you finance if you have a 10-20% deposit. This is because the company use that deposit as collateral. If you cannot keep up with your monthly payment, you will lose the deposit.

Loads of finance companies do like big deposit just in case you can’t keep up payment. Same with mortgage, they even give you a lower APR if you have a 40% deposit. Big deposit just shows the finance company that you are really serious about the loan and you will pay the money back if the bank lends it to you.

The rates will be really competitive if you have a 40% deposit. The lowest rate will be about 3.9% APR and if you don’t have a big deposit, you are probably looking rate at about 6.9%. It is a big different compare with no deposit. If you want the best rate for any loans, you will need to get a big deposit.

To get a better idea on where your finance is, you can always use a car finance calculator to make sure you get the numbers right. The calculation on monthly payment and add the deposit is very hard. Therefore, car finance calculator is easier to work out exactly how much you have to pay back each month.

Car Finance