Guaranteed auto financing or bad credit auto loan- which is better?
It is great to learn that you are ready to buy a car and are out in the market to find a suitable car. Today, anyone looking to buy a car needs to look for auto financing option. It is not possible for anyone to pay outright since the economy is tight. To get an affordable deal, you will need the perfect credit score. But, it is still possible to arrive at a suitable deal even if the credit history is not good. Get to know your auto financing options as all the smart car buyers do the same. After you find a suitable option, you need to talk to the salesperson and discuss that out. A car dealer can also offer proper deals on loan. There is no need to feel intimidated by your financial situation as you may negotiate over the prices.
What is bad credit car loan?
Bad credit car loan is the loan which is available on the new cars and through the new car dealership. It is also available on used certified cars that are pre-owned. Here the paperwork for the loan is efficiently handled by a car dealership, but the finance contract of the loan is sold to some other lender. It is the lender who maintains or services the loan. The period for repayment can be around 2 years to 5 years. The car loan rate will vary as we do not have many car dealers offering this option.
Guaranteed auto financing is completely different from bad credit auto loan
There are auto facilities directly offering guaranteed auto financing to the buyers. So, we can say that finances are coming directly from the independent lenders. In the guaranteed auto financing, the contract is offered by wholesale auto dealer whereby you also make the payment to the dealer. Thus, you are financing your car directly from the car company which sold you the car. One considers guaranteed auto financing when looking to buy a pre-owned or used car. Guaranteed car financing is not the option considered when one is buying a new car. The loan term is shorter than conventional loans. It may come around to 3 years maximum.
The benefit of choosing guaranteed car financing
There are some apparent benefits of the guaranteed car loan. Even if you are in bad credit, you may finance your car with guaranteed auto financing. Here there is no credit check as such. Here the payment is made weekly. It also has a downside, and that is, whether or not you are making timely payment, the car dealer will not report to your credit bureau. So, there is no chance of improving credit score even if you make timely payment.
Look for better financing options
You must start looking for car financing options much earlier. For the specific car financing options, you may look online. A lot many companies offer affordable car loan programs among which choices can be made.
After you gain approval for the car loan, you must set your foot inside the car shop. In both lousy credit auto loan and guaranteed auto loan, you may use your negotiation skills.
About Us: If you are wondering whether to choose guaranteed car financing option or bad credit auto loan, you need to understand both options and take a smart decision. Gaining approval for the car loan will not take time as there are too many loan providers. The value of the car loan is an essential factor to consider.