Many traditional banks won’t consider applications for car loans from customers with poor, moderate, or fair credit.
All publicly traded American banks are with boards of directors who expect to make profits every quarter. The financial institution will reduce its risk exposure in order to ensure that every bank is profitable. This means that applicants with bad credit will not be eligible for loans.
Credit unions, however, are member-owned institutions that return all profits to their members. This means that people with bad credit are not guaranteed loans, and financial products will be more affordable.
Almost all credit unions limit loans to members with fair credit. This means that you must have a FICO score greater than 580. However, this doesn’t mean that you are out of luck. Many independent lenders will consider auto loans for people with bad credit.
These subprime lenders often partner with online lending networks, including the ones listed above. They can approve loans in minutes. Some lenders will approve your loan within minutes, while others can take you to the dealership immediately.
This process is very similar to applying for auto financing through an agent. To determine which lenders may accept your loan request, the dealer will forward your application to several lenders. A lender will accept your loan request online. It takes just minutes and is sent to all the network partners.
You may receive multiple loan offers from the network within minutes of submitting your loan request. Some networks work directly with dealerships across the U.S. You will be contacted by a local dealership to arrange a tour of the lot and discuss your financing options if you apply to these networks. These could be traditional auto dealerships or local pay here, buy here car lots.
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