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How to get a Car Financed with Low Credit in Caledonia

How to get a Car Financed with Low Credit in Caledonia

There are a lot of perks to living in Caledonia: it’s still a small town, the land is beautiful, and the Grand River is stunning.  But, getting around without a vehicle can be a little tricky, and getting into a vehicle can be expensive.  So, if you live in Caledonia and don’t know if you have great credit, what can you do?

First things first: find out what your actual credit score is.  In Canada, a good score is considered to be over 660 (300 being the lowest and 900 the highest) and if you end up at this level or higher, you should have no issues with obtaining a loan for a new car.

If you find out your score falls into the subprime category (below 600), it can be easy to panic, but there’s no need.  All it means is you have to adjust your expectations and your approach to buying a car.  Instead of shopping for a brand-new vehicle, a used car is more likely to be what you’ll end up with.

You’ll need to direct your efforts to dealers who offer subprime financing, because they are the ones who will be willing to take a chance on you and help you to rebuild your credit with the car loan.  To offset this risk, lenders will require you to pay a higher interest rate on the loan.  Doing this helps the lenders continue to work with people who have lower credit and get them into the vehicles they need.

The best thing you can do is apply for pre-approval before you start shopping.  You’ll have to provide some basic details about your income in the form in order for lenders to assess your eligibility.  Once you’ve been pre-approved, you’ll know what price range you can shop in and avoid being disappointed when you fall in love with a car you can’t afford.

Applying for financing can have a slight impact on your credit score, so if you’re shopping around for a good rate try to apply to a few places in a small period of time to ensure you don’t end up with too many hits to your credit.

Luckily you can apply for pre-approval and start shopping all online, and who doesn’t love shopping from the comfort of their own home?

 

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    Categories: Car Loan