Bad Credit Car Loans – Buy Car Without Financial Worries

A borrower with bad credit tag usually has to go through lots of hurdles from the lenders as such borrowers have risks. Some of them may even be refused a loan. so when such people want to buy a car with a bad credit they face impediments. The remedy however lays in applying for bad credit car loans that are made especially to people having a damaged credit history. All people who have in their names late payments, payment defaults, arrears or cases of county court judgments can find car loans with ease on meeting some conditions.

To cut risks the lender in offering car loans to bad credit people first of all want a security from the borrower. Home or any valued property or the very car you are buying can be pledged as collateral. Secondly the lender will take a good look at your present financial position. Your income and employment record with bank statements are looked thoroughly to ensure that you have adequate repaying ability. Secured Bad Credit Car Loans are of comparatively lower interest rate. Also you can borrow greater amount depending on value of collateral.

Unsecured bad credit loans are also available without collateral to the borrowers who do not own a property or do not want to risk it. But interest rate goes higher for such borrowers. The loan gives smaller amount. But secured or unsecured bad credit car loans are of shorter repayment duration ranging up to 5-7 years.

You are required to make down payment to the lender so that the lender is assured of your serious intentions of repaying the loan in time. Usually the practice is that you should be making 20 % of the car value as down payment. Before applying for the loan check your credit report for any errors in it and know your credit score to find a suitable loan as per your circumstances. For fast and cost free processing of the loan apply to an online lender after comparing many of them.