After the mortgage fiasco in 2008, both mortgage lending and car financing got tougher, this was especially true for those who had low or no credit at all. Many car owners had no option but to keep their cars rather than purchase a replacement simply because they could not get the financing required or they had perhaps justifiable concerns about taking out a loan when the employment picture looked bleak.
On the bright side, the economy is improving; as a result lenders have relaxed their terms somewhat and made access to financing easier for people. There is downside however, if you want to buy a Chevy in Chicago and you have credit issues you will end up paying a premium rate of interest because to the lender, you pose a higher risk. The criteria used by lenders does vary somewhat but as a general rule, a score of 660 or lower or if you have declared bankruptcy during the previous five years or your income to debt ratio is in excess of fifty percent, you are seen as a sub-prime borrower and you can expect to pay more for money.
If you still want to buy that Chevy in Chicago that you have your eyes on, what are the options if you have less than stellar credit?
Cash works: Cash is king, always has been and always will be. If you can manage to save enough to buy the car for cash you will not have any problems in the future with cash flow which unfortunately can lead to your having the car reposed which only damages your credit score more. Obviously paying cash is not realistic for everyone but if you can do it you will not be faced with unusually high interest due to your credit situation.
Length of term: If cash is not on the cards and you must finance the purchase set yourself a limit on the monthly payment, be realistic and only pay an amount that will not stretch you too far. The longer the loan period usually means you owe more on the car than what its worth based on depreciation.
Get someone to cosign for you: If you have a parent or sibling for example that has good credit and is willing to cosign on the loan, the arrangement will be more attractive to lenders.
If you are looking at purchasing a Chevy in Chicago you are invited to visit the internet web site of Hawk Chevrolet Cadillac of Joliet where you can estimate your credit score and pre-qualify for a loan.
