Category Archives: Financial

Cosigning Conundrums & Solutions

The common question running through a first time car buyer’s mind: �Is it possible for an eighteen year old to purchase a car when the cosigning parent has a bad credit history?� Bad credit score, zero credit history and inadequate information about auto loans can compel you to think that having a cosigner is the only way out. A cosigner can drastically improve your chances of getting approval for an auto loan. However, purchasing a car is still possible in times when you cannot find a cosigner. Moreover, breaking some common conundrums about cosigning can provide a great deal of clarity in order to obtain the auto loan for your dream car.

Buying a Car without a Cosigner: Unravel the Mysteries

Buying a car without having a cosigner can be a tricky task. Many car buyers are ignorant about what happens when one doesn’t have a cosigner. Do not make an ill-informed buying decision. Learn which cosigning conundrums keep us from buying a car and what are the solutions to break them?

1) Conundrum: Without a cosigner, I am bound to pay high interest rates.

Solution: A huge down payment is the ultimate evidence of your credit worthiness. A lump-sum amount at the beginning of the auto loan term will put you in a good position to bargain for good interest rates. Additionally, putting money down reduces the amount of your monthly payments. Remember that more the down payment, the lower will be your future auto loan payments. Once you put a good amount of down payment, the approval for the auto loan will not require a cosigner.

2) Conundrum: I need an exceptional income record for obtaining auto loan without cosigner.

Solution: If you have suffered from bad credit in the past, your creditworthiness is assessed by your current income. The amount of monthly income along with the stability of the employment plays a huge role in determining your reliability. A minimum monthly income of $1,500 is considered ideal for getting an approval without a cosigner. However, the minimum income requirements vary from lender to lender. Therefore, make sure you keep regular track of your income pay stubs and use it as leverage to obtain an auto loan without a cosigner.

3) Conundrum: If I don’t have a cosigner, I cannot buy a new car.

Solution: When you do not have a cosigner, it may seem that new cars are out of reach. But, it is far from truth. A used car with a low price tag looks less risky to a lender. However, your options do not end there. With a strong FICO score and regular efforts to build a strong credit, you can purchase a new car even without a cosigner. In order to improve your credit score, build a good debt to income ratio, keep your credit utilization low and make timely payments. Once you have a good credit score, you can purchase a new, more reliable and updated car.

It is common to think about all the support you can get while applying for an auto loan, a cosigner being one of them. However, it is possible to obtain an auto loan even without a cosigner. With the rightly calculated moves, your dream of obtaining a new car will not require the pillar of support in the form of a cosigner.

Second Chance Auto Loans

Everyone with a bad credit score knows well that Murphy’s Law acts a major obstacle while buying a car. Everything that can go wrong will go wrong. And, the main reason behind it is the terrible credit score. Lenders will reject your loan application. And, if anyone offers you an auto loan, you will have to suffer with high interest rates. So, what should a bad credit car buyer do? Refrain from buying a car for his entire life? Are loan sharks the only resort for making a car purchase with bad credit?

Don’t despair; here’s something to help you out!

With the increase in online auto financing company, the competition among lenders has increased. It has led to easy availability of second chance auto loans. The loan program is ideal for car buyers with credit issues. So, if you are in bankruptcy, or you have a subprime credit score, do not worry. There are a few lenders out there, who can help you make a fast car purchase.

Second Chance Auto Loans: How to get one?

The number of lenders offering second chance auto loans has increased. But, if the lender doesn’t find you financially stable, your auto loan may get rejected. So, learn two important tips for getting the loan. It will help you to buy the car and improve your credit score as well. Get ready to seal the deal.

1. Focus on your Income: Tell the Truth

Most car buyers do not report their total income to the IRS. It may help you to save money on your tax. But, remember that if you do not report your income, it will not reflect in your yearly income statements. Lenders consider your income listed on W-2 form or they go for the tax returns to check it. So, even if your bank records show the additional income, lenders will not consider it for calculating your debt to income ratio. It can prove to be negative for you as low income and bad credit are the two things that lenders try to stay away from.

2. Curb your Expenses: Buy an Affordable Car

When you credit score is below prime, you need to be ready for high interest rates. Lenders will consider your loan application risky and demand high interest rates for it. But, high interest rates do not mean that you have to keep making huge monthly payments for the loan term. Choose an affordable car, preferably a used car, to lower the total cost. You can even think of buying a demo car or a discontinued car model to reduce the price. Remember that second chance auto loans can be your ticket to better interest rates if you make regular monthly payments. So, stay in budget and compromise on an affordable car.

When you are applying for a second chance auto loan, you need to focus on two things: 1) Your income and 2) Your expenses i.e. your car budget. By maximizing your income and presenting a clear picture of your financials, the lender will be able to understand your situation in a better way. Also, it will give you a perspective on choosing a car within your budget.

Take time in understanding your financial situation and make a practical choice. Remember second chance auto loans can buy you a car as well as pull you out of the abyss of bad credit score. So, next time, you seek an auto financing company for buying a car, work out the details to get the best deal.

Learn The Most Important Thing While Buying A Car

For many of us, buying a car is a way of fulfilling a life-long dream. Even though a car purchase is a common phenomenon, many make mistakes and end up paying with their credit scores. When dealing with the four-wheeled beauty, you must be diligent and strive to get the best deal. No matter what you do, there is one important thing that you cannot miss while buying a car.

Research: The Key to buying a Car with Bad Credit

If you have a bad credit history or any other problem that makes your credit application weak, the game changes for you. In an ideal world, the lender and the dealer should treat you as they treat a good credit borrower. You should be able to buy a car of your choice and obtain affordable interest rates. However, the real world is cruel and you will face discrimination on the basis of your credit score. If your credit score is below 580, lenders will consider you as a risky credit seeker and ask you to bring a down payment and a cosigner. So, how to come out as a winner and buy your favorite car with bad credit?

If you are unable to buy a car quickly, you need to research. Knowledge is power. And, when you do not have an upper hand while buying a car, you need all the knowledge in the world to secure the best deal.

Do you really want a Car?

When you are buying a car, it is important to take a hard look at your financial situation. Can you afford to buy a car? Will monthly payments put a burden on you? If you need a car to commute, it is essential that you cut down on your expenses to ensure regular monthly payments.

Spend time in selecting a Car

Thinking of buying a car and selecting a car are two different things. Do not settle for a used car because you cannot afford a new one. Search for discontinued car models in your area so that you can get your hands on a new car at a reduced rate.

Visit more than One Dealer

Never deal with the first dealer you visit. Even if you are in a hurry to buy a car, make sure that you visit at least three dealerships. Learn the different car options available at the different lots. Talk to the salesmen and negotiate an affordable price for the car. Also, search online and learn about auto auctions to get the best deal on a used car.

It’s Time for Auto Loan Research

If you do not make a right auto loan decision, it will pinch you every time you make the payments. So, find an auto financing company who works with bad credit car buyers. Ask questions about their loan process. If you are a member of a credit union, you can seek financing from them.

Do not worry about getting negative hits on your credit score. Fair Isaac Corporation understands that one cannot obtain an auto loan without rate shopping. If you find an auto loan within 30 days, the different inquiries will not have a negative impact on your credit score. So, do not worry about working with different lenders to find the best deal.

The Bottom Line

When you credit score is not excellent, you need to spend more time in research so that you do not end up paying more. Do not make a hasty car buying decision. Spend ample time in researching a car model as well as the lender. Remember that the time you spend now will leave you stress-free forever.

Bad Credit Car Buyers Benefit

Buying a car and arranging for an auto loan go hand in hand. Whether it is your first car or your fifth car, you will require an auto loan at some point. While arranging for an auto loan, your credit score becomes the yardstick to measure your credit worthiness. A bad credit rating means auto loan rejection. However, there is a way out. Three major credit rating companies, namely, Equifax, Experian and TransUnion have decided to eliminate and exclude certain customer information from the credit reports. And, it will have a positive impact on your credit score.

The New Regime: What’s in it for Bad Credit Car Buyers?

1) Upsurge in Credit Scores

The new change relates to all civil debts and many tax liens. Civil debts and tax liens are enlisted under �Public Records Section’ of the credit report as they are unpaid tax bills. Unless there is elaboration of information, the credit bureaus will remove the debts and liens from one’s credit score. As a result, those who suffer from a bad credit score will see a hike in their score by approximately 20 points.

2) Higher Probability of Approval

The elimination of the civil debts and tax liens will increase your credit score. As a result, the chances of obtaining an auto loan will improve for bad credit car buyers. The new credit policy is implemented from 1st of July, 2017. Make sure that you have revised your credit report in order to get a better shot at getting approval for an auto loan.

3) Favorable Interest Rates

Lenders charge bad credit car buyers with high interest rates due to a damaged credit history. However, once your credit score increases, the interest rates will decrease. Therefore, the new credit regime will help bad credit car buyers to obtain an auto loan with favorable interest rates.

4) Improved Car Choices

The car choices for a credit challenged individual are limited. Lenders are comfortable to lend out money for a used car. However, the increase in the credit score due to the new regime can bring multiple car choices for a buyer. A bad credit car buyer with an increased credit score can avail an auto loan for a new car as well as a used car. Thus, a bad credit car buyer will have multiple car options to choose from.

Any change in any system causes panic. As a result, lenders will become cautious in approving future auto loans. Additionally, the cut off rates for credit approval may take a hike. However, the 1st July credit change will largely benefit bad credit car buyers. The increase in your credit score will be a means to improve your credit-worthiness in the eyes of your lender. Considering the new changes, the imperative step would be to know your current credit score and grab every opportunity to improve it. An improved credit score will be an easy way to avail an auto loan for your next dream car.

A Boon For People Who Need Instant Money

Loans have gradually become an important aspect of our lives. A few decades ago, an individual who would want to borrow a personal loan would have to go through a complicated procedure to avail it. However, with a host of financial companies which came into existence about a decade ago, the concept of borrowing a personal loan has been revolutionised. The financial institutions have explored the possibilities and have come up with much more flexible loans to help cater the needs of people.

What are Personal Loans?

Personal loans are an unsecured form of loans which involve quick sanctioning and easy payout. However, the most intriguing part about a personal loan is that a collateral is not required. Personal loans often include borrowing of an amount to fulfil the needs pertaining to medical, education, gadgets, travel, vehicles, etc. However, you are free to utilise a personal loan the way you want.

What Must you Consider While Borrowing a Personal Loan?

When talking about a personal loan, it is essential that you take three factors into consideration – personal loan amount, tenor and the rate of interest. These three aspects go hand in hand. The amount that you borrow, the tenor that you choose and the rate of interest that you are provided with determines the EMI that you will pay

A personal loan is a great way to overcome shortcomings. It is a boon if you are falling short of the required amount to fulfil your need. There are several ways in which you can utilise a personal loan to its fullest. Here are a few requirements in which you can optimally use personal loans: Financing home renovation: There are many people who want to remodel their home. However, la

Financing Home Renovation: There are many people who want to remodel their home. However, lack of funds is the major obstacle that comes their way. There might be a special occasion where renovating a house is pretty much in culture, under such a scenario you can opt for a personal loan for house renovation. Apart from that even if you wish to add details, put a new roof, or build an extra room; a personal loan will come in handy.

Payment for a wedding ceremony: Almost every individual dreams of a perfect wedding. Especially women, who plan and think about it a lot. Not just the kids but even their parents are keen on the occasion. Most of the parents start saving from the early days. However, such is the cost of marriage in today’s time that savings cannot fulfil the requirements. Thus, borrowing a personal loan does a lot of good under this scenario.

Credit score: A personal loan helps in improving a credit score tremendously. There are various bodies, most prominently, CIBIL which calculates a credit score. A good credit score will help you avail tremendous amount of benefits whereas a bad credit score can hurt your chances of availing any form of a loan. In a personal loan, when you repay your loan on time, your financial credibility with the lender improves significantly.

Paying debts endured on cards: A personal loan is usually borrowed to pay off debts on credit and debit cards. A personal loan might require you to pay a high rate of interest as the nature of the loan is unsecured. However, it is much less than the one you are being charged on your credit/debit cards. Borrowing of a personal loan to clear debts is a very good idea.

These are few options regarding how you can make the optimal use of a personal loan. Apart from these options, you can even use it for investment purpose to make a considerable profit.

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