Car financing is where a loan is taken out to pay for a car, and then repaid usually on a monthly basis. Obviously, this means that you don’t need to have the money outright, and can pay for your new wheels in instalments. For many, this is a very cost-effective and convenient way of doing things.Many lenders will stipulate that you need a good credit rating if you want cars on finance. It’s easy to understand why, and a good credit rating, generally speaking, is an important indicator of your ability to meet repayments.
However, there are car finance deals out there that are tailored for those who do not have good credit ratings. If you have bad credit and you’re looking for car finance, be careful, as many lenders will offer non-competitive rates or inflate the price of vehicles.
The best lenders like it when they can see that you’re taking steps to improve your credit rating, (in fact simply paying off your mortgage is an effective way to improve it,) and so if you’re in debt counselling or consolidating, your debts will lessen and your financial situation will become brighter.
These days, there is a stigma placed on bad credit, perhaps unfairly so, as we are now all at the whim of financial fortune. Don’t worry though, as various companies recognize this and endeavor to offer options suitable for your specific needs.