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Bad Credit Auto Loans – Things To Avoid

Beware as your “so good” auto loan may be the last nail on your financial coffin. One good thing about bad credit auto loans is the fact that it makes it easier for people with not so good a credit score to own cars. With the financial services sector morphing into a multi-billion industry each new day, more lenders are out to catch the last of clients. Along with this phenomenon come “very attractive” offers from such lenders. Whereas some offers are valid, there are unscrupulous lenders whose major aim is to drain your financial portfolio and walk away. This article brings into light some of the things that you should avoid on bad credit auto loans.

Never finance at a dealer if you have bad credit. Prepare your financing well in advance and compare to dealer’s financing. Bad credit auto loans secured through personal financing are not subject to monthly payments scams such as the popular spot delivery scam. The deal will not be based on monthly installments but on the selling price of the car. If the dealer tries to negotiate the car basing it on monthly payments, leave immediately. If you must finance through a car dealership, don’t take delivery of the car until the loan is approved. If you leased the car instead of buying it, consider with wary any lender who says they made a mistake and needs you to sign a new contract.

If you are co-signing for a bad credit auto loans, make sure both signatures appear on the same contract. Don’t be duped to sign on different contracts, otherwise you will be a victim of straw purchase scam. Most people with very bad credit score and not careful enough are easily duped. The lender knows very well that your outrageously poor credit history cannot secure you a loan even with a co-signer. So they ask for a co-signer with a good credit score who carries the entire loan instead!

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