If you recently filed for bankruptcy but still need an auto loan, you might be surprised at how easy it can still be to get approved. Because the vehicle can be used as security for the loan, it's much easier to get financing for a car if you've had credit problems in the past than it is to get a new credit card or another kind of unsecured loan.
There are a lot of online finance companies competing for your business to help you pay for your car. Just watch out for unethical ways of lending. Scams that involve lending often target people with bad credit. Borrowers with bad credit have fewer loan options than other borrowers, which is something that some finance companies take advantage of. Here are three things you can do to protect yourself from a company that doesn't have good morals.
Compare rates from at least three different online lenders - If you have 3 or more loan offers to compare, you are much less likely to take one from a lender with high interest rates. If you have at least three different interest rates to compare, you will have a good idea of what the average interest rate is for auto financing for people with bad credit.
Get a loan before you go to a dealer. If you are going to buy a car from a dealer, make sure you have a loan before you go to the dealer. Dealers and lenders often make deals to work together to charge the borrower a much higher interest rate than they could get by shopping around. If you have the money before you go, you won't have to take the money they offer you there.
Apply with lenders who have a good reputation. If you apply with lenders who have been around for a while and have a good reputation, you have less chance of being taken advantage of.