“I have bad credit and no job. Who will give me a car loan online?”
Sometimes, life throws you a curveball and you find yourself in a situation where you are unemployed, have bad credit status and in dire need of a car to find work and make ends meet. Instead of sulking in misery over your financial failure, you need to get it together and reclaim your financial independence. The first step is to get a car loan.
Even when you’re unemployed and have bad credit, you can still get a car financing through a Bad Credit Car Loan. Also known as Second Chance Car Loan, this type of loan is designed to give borrowers with bad credit access to car financing.
Here’s how to apply for a Bad Credit Car Loan:
1. Know which car you need.
It’s important to know which car you want before filling out the loan application form because the vehicle you purchase will serve as collateral for the loan. The lenders will need to ensure that the car is in good condition and is priced relatively well. This is so that they can sell it and retrieve the money if you default on your payment.
Prequalification and Preapproval
Lenders usually offer a car prequalification and pre-approval for car loan applicants, which help them decide on the car they will likely purchase.
A prequalification assesses your general creditworthiness based on some basic information regarding your finances and credit history. Being prequalified for a bad credit car loan, however, does not guarantee that you will be approved for the loan.
Prequalification is different from pre-approval, which is a more formal step that involves a thorough financial background check. After checking your financial capacity to pay a loan, lenders will tentatively decide on the loan amount that you’ll get. Like with prequalification, however, there is no guarantee that your actual loan is the exact amount quoted under the pre-approval. It also does not guarantee that your loan application is approved.
Approval is what you need. Once your bad credit car loan application is approved, all you have to do is sign some paperwork to get your car loan.
2. Calculate how much you can afford.
You can use a car loan calculator to get an estimate of your car loan repayments and how much you can afford to spend on a car. The calculation is based on your vehicle purchase price, loan deposit and the balloon payment. However, the estimated car loan repayments may vary based on your personal or business finance profile. Thus, its estimated car loan repayments do not constitute a quote.
To get an exact quote for a car loan, it’s best to request for Quick Car Loan Quote from a car loan specialist. You will need to provide some personal and income information, desired loan amount, and the details on the car you want to purchase, including its make, model and year.
3. Compare loan terms.
The terms and interest rates of your bad credit car loan will be influenced by the loan amount and any down payment you make. If you are likely to get refused for a large loan, it’s best to get a smaller loan or offer a large down payment or trade-in.
Take note that your monthly payment is affected by your loan’s interest rate and length of payment. Choosing the lowest monthly payment will result in a loan that takes several years to complete. The longer your loan term, the more interest fees you will pay.
The ideal car loan has an affordable monthly payment and reasonable interest fee.
4. Get a co-signer.
While it’s ideal to pay a huge amount for your downpayment to lower your monthly payments, this may not be possible if you are jobless and do not have enough money for the down payment. Thus, the best way for you to get approved is to have a cosigner (which agrees to pay for any missed payments or repay the loan if you fail to do so) or a co-borrower (a joint applicant with equal rights and responsibilities to your car and your loan):
Your co-signer or co-borrower must have:
- good or great credit rating
- income that meets the lender’s minimum requirement
- a disposable income to be able to handle the loan
- a source of income that can be garnished
If you to apply for a car loan but can’t seem to find one that works with your situation, reach out to the Bad Credit Car Loan Specialists at Positive Lending Solutions. We can help you secure a bad credit car loan and repair your credit history.
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