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Financing a Glen Abbey Car Loan after a Consumer Proposal

Financing a Glen Abbey Car Loan after a Consumer Proposal

A consumer proposal does not damage your credit score like a bankruptcy, but you have your work cut out for you if you want to get a car loan in Glen Abbey. Especially in the current market with lenders more risk averse than usual.

 

How Covid changed the car buying marketplace

 

The pandemic has caused uncertainty in the economy, and to make things worse, the war breaking out in Europe just makes things worse.

 

Lenders want predictability when issuing loans, and this is something that is currently missing, “predictability.”

 

To mitigate the risks of borrowers defaulting on their loans, lenders have raised the minimum credit score needed to secure a car loan from 680 up to 720 for the most competitive interest rates.

 

A consumer proposal would have knocked down your score to the poor range, so you will not be able to access these prime interest rates.

 

Taking a closer look at your income

 

There are lenders who cater to borrowers with poor credit or those who recently came out of bankruptcy/consumer proposal.

 

These lenders focus more on your income and, based on how much you earn, they will decide whether to offer you a Glen Abbey car loan.

 

The lenders are going to charge you a hefty interest rate to mitigate their risk, so you will not be able to buy a new car but instead, opt for a previously owned model.

 

However, the used car market is experiencing incredible demand in Canada, so buying a used car will probably make the best dollars and sense for you.

 

Lenders will not approve a loan if your debt-to-income ratio is greater than 40%. What makes this ratio challenging is you could be carrying extra debts.

 

This would be a great time to pay down any existing debts you may help increase the maximum car loan you can secure.

 

Rebuilding your credit after a consumer proposal

 

You need to start working on rebuilding your credit score after the consumer proposal.

 

Unfortunately, your credit score is not going to “fix itself,” and the consumer proposal will stay on your credit report for the next seven years.

 

The majority of creditors will not give you a car loan or any form of credit with the consumer proposal inside your credit report; you must sign up for a secured credit card.

 

These secured cards work just like traditional cards; you just need to deposit money which works as your credit limit.

 

Where to get a Glen Abbey car loan when you need a car ASAP

 

You need a car as soon as possible and cannot wait a few months for your credit score to bounce back; in this situation or any situation where you need a good deal on a car, head over to your local car dealership.

 

These dealerships have access to lenders you could never find on your own, these lenders are willing to give you a car loan, and you can drive a car home today.

 

The first step is to contact your local car dealership and explore the range of car loans you can secure based on your current credit profile.

 

When you’re ready for a car lease or loan, get in touch with the Glen Abbey auto loan experts at Northway Ford for great deals on auto finance.

Categories: Car Loan

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