Used Christian Auto Financing
Obtaining used Christian auto financing, in one sense, has never been easier. Many consumers are able to get a loan by filling out an online application at a lending institution's website. They may complete the application online even when applying through their own bank or credit union. Or they can choose one of the many online financing companies. Several of these promise an answer within minutes of submitting the application. A consumer who has all the required information close at hand may find that the entire process is completed in very little time. But the ease of completing online applications should not be the main criterion for choosing a used auto financing company. There are several things a prospective buyer needs to consider before taking this financial step.
Buying a used car can sometimes feel like a catch-22 situation. The consumer doesn't know how much money to borrow until she finds the car that she wants to buy. However, she may not know how much she can spend on a car until she completes a loan application. Financial websites help in this type of situation by providing car loan calculators. By entering different variables such as possible loan amounts, typical interest rates, and the number of months for the loan, the calculator calculates the monthly payment for the varying scenarios. The consumer can try out different variables to find a range that makes sense in her monthly budget. This will help give her an idea of how much money she may be qualified to borrow before she ever begins her used car search.
However, real life often seems to work the other way. The consumer may find the car or truck that he just has to have. Then he tries to figure out a way to pay for it with used auto financing. Online calculators can still be a help. The individual knows the amount of money he needs to borrow. The calculator can help him figure out how realistic his chances are of borrowing that amount given the probable interest rate and length of the potential loan. For example, a teenager with a part-time job may have his eyes and heart set on a specific truck model. After searching through want ads and conducting online research on the values of this type of vehicle, our teen knows about how much money he needs to buy a vehicle of this particular model that is about five- to seven-years-old. By using the online calculator and analyzing different interest rate/length of loan scenarios, the teen (and his parents) can decide if that part-time job is going to pay enough to cover the truck's monthly payments, the insurance, and the gas.
All three variables of used auto financing (amount of loan, interest rate, and length of loan) are important in determining a monthly payment. Of course, the amount of the loan may fluctuate depending on one's negotiating skills with the seller of the selected vehicle. The consumer may, to some extent, choose between several options when it comes to the length of the loan. The interest rate, also known as the APR (annual percentage rate), depends on several factors and the individual may not have much choice in what the final APR will be. An important factor is the consumer's credit history. Before beginning the used auto financing process, prospective buyers are well-advised to review copies of their credit reports. These can be obtained from the three major credit bureaus: Equifax, Experian, and TransUnion. Consumers have the right, on an annual basis, to receive one free credit report from each of the three bureaus. Consumer advocates often suggest that individuals set up a routine of ordering a credit report from just one of the credit bureaus every four months. This practice helps individuals stay on top of the information contained in the credit reports.
The credit bureaus assign a score to each individual based on a multitude of variables that include past payment history, lines of credit, and stability. The scores from the different bureaus will not be the same because each one has its own secret formula for determining the score. However, they should be in the same range. Generally speaking, a person with an excellent credit score and history will be able to get used auto financing at a lower APR than someone with a poor credit score. By getting the credit report before beginning the loan application process, the prospective buyer can check to see if there are inaccuracies in the report. This allows her to fix any mistakes before a lending institution pulls a copy of her report. If the score is low, the prospective buyer may be able to take some positive steps to raise the score before applying for a loan. On the other hand, if the prospective buyer knows, and can document, a high credit score, he will not fall prey to the scams of some unscrupulous auto dealers and finance companies who may try to dupe him into signing a contract for a loan with a higher than necessary APR. Unfortunately, not all people follow the instruction of Scripture: "A good man sheweth favour, and lendeth: he will guide his affairs with discretion" (Psalm 112:5).
The model year of the vehicle will also affect the APR. A newer car with a low APR may actually result in lower monthly payments than an older car with a higher APR. This is information that a savvy consumer will want to consider when applying for a loan. Another interesting tidbit: some credit unions will not provide used auto financing on vehicles that have more than a specified odometer reading no matter how new the car may be. A prospective buyer, especially one with good credit, may find it is easier to obtain an unsecured loan instead of designated used auto financing. An unsecured loan doesn't require collateral, but is based on the person's reputation as someone who has a history of paying obligations on time. With this money in hand, the prospective buyer can seek out the best possible used car deal possible.
Christian Second Chance Auto LoanSecond chance auto loans can help drivers with bad credit get a car. Typically, bad credit prevents people from borrowing, especially borrowing for large expenses like houses and cars. Lenders don't tend to trust people with low credit scores. However, there are lenders who offer loans especially for people with poor credit. There are many companies out there competing for customers so there are some basic things that drivers need to think about before getting a second chance auto loan.
One of the things that drivers need to do with second chance auto loans is not go overboard. They shouldn't get a car that is financially out of reach just because they like it. This could put the driver in a place of financial burden all over again. Borrowers should get a second chance auto loan that is affordable to pay back. They need to examine their finances and make sure that they can afford to make the monthly payments. Otherwise their credit will continue getting worse.
Remember that second chance auto loans are a good thing as long as drivers find the right company to work with. Many companies will offer these types of lending simply because they want money. Find a company that has the customer's interest at heart and will work with them well. Remember that the Lord is a Lord of miracles and can work one in anyone's life. "This also cometh forth from the LORD of hosts, which is wonderful in counsel, and excellent in working." (Isaiah 28:29) God can work through wise spending and careful decisions to help drivers get a car and overcome debt.
Drivers should consult their family members about the decision to buy a car. It's a good idea to ask them if they have ever gotten a second chance auto loan and what kind of company they decided to go with. It's not always easy to be approved for this type of lending. Most lenders ask that applicants have some kind of proof of trying to get their credit rating better. Drivers should not simply see the second chance auto loan as another opportunity to get deeper into debt. This needs to be an opportunity to improve their credit rating and help their finances in a way that it couldn't before. Seeing a financial advisor and working at payments of current debts will show potential lenders that the borrower is serious about getting better credit.
Guaranteed car loans are a way to get financing without having great credit when someone needs a co-signer. It is important to evaluate the actual need of any type of financing before applying, especially with bad credit. This can be a great benefit to the person needing the guaranteed car loan, but it can also be a negative to the person signing. It all depends on the way the situation is handled. Knowing all the options and information before asking someone to cosign and before making a final decision.
Co-signing creates a great responsibility for the co-signer. Once a person co-signs they are assuming responsibility if the borrower cannot pay. If the borrower makes a late payment or misses a payment credit will be affected. If the borrower files bankruptcy or simply cannot pay anymore, it becomes the co-signer's responsibility to pay the amount off. So think carefully before co-signing for any guaranteed car loans. It may even be wise to write a separate personal contract with the person that needs the co-signer in order to maintain a good personal and business relationship.
Finding the best deal is another issue worth discussing. Each guaranteed Christian car loan will be a little bit different. A person will not only want to pay attention to the interest rate, they will pay but also pay attention to finance charges, late fees, and other charges that may occur. Once someone has found a guaranteed car loan that fits all the personal needs, make sure to have full understanding of what the payment is and when it is due. This will help keep on track with payments. Guaranteed car loans were designed to help people that have poor credit get a car. Of course, in turn, the bank is making more money because of the larger liability to the bank. This is where the co-signer comes in. In order for the loan to be affordable the bank requires a co-signer so they are assured their money.
Matthew 18:30 says "And he would not: but went and cast him into prison, till he should pay the debt." Guaranteed car loans can be a great opportunity to build credit for both the borrower and the co-signer. Pray that God leads a specific situation to the right decision concerning money. God will help with a budget and help a person stay focused on their financial goals. Keep Him close at heart and all things will be possible. A guaranteed car loan is not a sinful thing as long as a person is honest and hardworking toward paying debt off and working toward a more fruitful financial life.