Having a low credit score can make it very difficult to get auto loans from established commercial banks. Thankfully, there are some great alternatives to help you get that loan you really need.
Use our Website to Get an Auto Loan
Car Fast Financial offers bad credit auto loans in Atlanta at reasonable interest rates. We don’t discriminate against people with bad credit like many other lenders. We make the process easy and smooth for you, and make sure both parties are very happy with the deal. Our belief is that a transparent and clear lending process leaves both parties satisfied. If you don’t need an auto loan or are outside the Atlanta metro area, read on for some other great options.
Borrow Money from Family and Friends
This option may seem obvious but many people feel hesitant about turning to family and friends for a loan. You shouldn’t be scared to turn to someone you deeply trust for a loan, especially if you know you can pay them back with favorable terms for them. Ensure you create a written agreement that outlines all aspects of the loan, including interest rates or what will be done if you can’t pay the loan back.
Get a Co-signer for the Loan
A co-signer essentially accepts responsibility for paying the loan if you can’t pay it back. A commercial bank will lend to someone with a very low credit score if they have a co-signer with strong credit. A family member with strong credit who trusts your ability to pay back your loan is ideal. Work out the payment plan with them, and what you’ll do for them if you end up not being able to make payments. You should only have a co-signer with whom you have a strong trust based relationship.
Get a Home Equity Line of Credit or Loan
Commonly known as second mortgages, you’re borrowing against your home equity. The difference between the unpaid amount on your mortgage and the value of your home is your home equity. For example, if your home is worth 550,000$, and you owe 240,000$ on it, you have a home equity of 310,000$. Essentially, the loan or line of credit is secured by your home, and if you are unable to pay it off you may lose your home.
You can use your home equity for either a Home Equity Loan, or a Home Equity Line of Credit (commonly known as HELOC). The first is a one-time loan that is paid off in a fixed amount of time with fixed payments and interest rates. HELOC on the other hand is similar to credit card where you have an available line of credit with a limit. As with a credit card, you can pay off your balance at a later time with added interest. Both credit cards and HELOCs are rotating lines of credit.
It’s very important to do your research before tapping into your home equity; HELOCs typically have fluctuating interest rates that can add up if you’re not careful. Additionally a downtown in the housing market can be dangerous for someone who has borrowed a lot of money from their HELOC.
Get a Loan from a Credit Union
Credit Unions are similar to banks except they are anon-profit member owned financial institution. That means they typically offer better interest rates and better terms. They’re not out to maximize profit for their shareholders, but instead are looking out for the best interest of their members. If banks have been turning down your loan applications, you should consider getting into contact with a credit union and think about becoming a member. It’s possible a credit union may be willing to accommodate your situation if a bank won’t.