Bad Credit Car Loans

What are credit defaults?
When you enter into a finance agreement or credit contract such as:
• Telephone or electricity
• Credit Cards
• Car Finance
• Personal Loans
• Equipment Rentals or Finance
• Home Loans
Under the terms and conditions of the contract, it is essential for you to make regular repayments to reduce the financed amount.
An inability to make the regular monthly repayments to your lender according to terms of your contract can end with the lender placing a black mark against your status on your credit report. Defaults are sometimes placed only on your credit history if you have gone without making the required payments for 2-3 months or more.
In common cases the lender will try to contact you first to arrange the payment delays casually. Although if they cannot contact you or you are simply not capable of making the required payments, a default may be placed on your credit report.
How do I increase the possibilities of getting approved for a Bad Credit Car Loan?
To have a better chance of getting approved for a Bad Credit Car Loan, you should consider the following:
• Placing in a deposit or trade in. This will decrease the risk for the finance provider or bank.
• Apply with a guarantor backed with an asset
• Purchase a vehicle with less than 7 years of age.
• Your finance broker should be knowledgeable in Bad Credit Car Loans.
• A savings history should be provided to the finance provider or bank.
• Having exceptional unpaid defaults often will go in opposition to you. Settle these before applying for a Bad Credit Car Loan as most finance lender's and banks will not to lend to someone that they have had previous losses with.
• Avoid providing false and ambiguous information to cover up your bad credit.
• Check your credit report CRA frequently.

What are the types of Bad Credit Car Loans?

Most Bad Credit Car Loans are consumer based finance products but Bad Credit Car Loans can also be provided with the following business related finance products:
• Commercial Hire Purchase
• Chattel Mortgage
• Car Lease & Finance Lease
• Novated Lease

What will the interest rate be?

Bad Credit Car Loans regularly have higher interest rates and fee charges compared to other car finance products, this is due to the perception of higher risk to the finance lender or bank due to your past credit history. Remember, nothing comes free and sometimes a "second chance" does come at a cost.
The terms and conditions of the Bad Credit Car Loan may also be more unbending for those with a bad credit rating. Before you sign the documentation, it is imperative that you compute whether you can afford to pay the monthly payments for the Bad Credit Car Loan as it should not be another debt that will overstrain your finances.

What will I need to apply for a Bad Credit Car Loan?

The key is to be honest and don't cover up anything. Other supporting information that may be required are:
• 3 months bank statements.
• Two most recent payslips.
• Copy of your driver’s license.
• Consent for the finance provider or bank to check your CRA.