How to Get Approved for a Car Loan after Bankruptcy or with Bad Credit

By David Maillie

Bankruptcy and bad credit can make you think your ability to get a car loan will be an impossible task. But it doesn’t have to be. Also, any new loans including a car loan will help you to build and reestablish your credit and credit history. Most finance companies won’t deal with you if you are in the middle of bankruptcy, but they will when it is finalized as you can then legally take on debt and reestablish yourself. Bad credit should not mean no credit. You can still get a good car loan and even a reasonable or good rate and payment. Here are some excellent tips and pointers to help you get the best car loan and terms possible regardless of your credit history.

First, get a copy of your credit report.

This is a crucial step as your credit report may and probably will contain some erroneous and derogatory information. It is a known fact that over 90% of credit reports contain some sort of error or incorrect information. This can range from wrong contact or loan info to derogatory debt info that should be removed as it is older than 7 years. The rule is that most derogatory credit and debt reporting can only stay on your credit report for 7 years (a bankruptcy is 10 years). Many collection companies and other creditors abuse this law by relisting bad credit with different loan numbers and such. This is actually illegal and a violation of the Fair Debt Reporting Act. If you find any fraudulent reporting like this hire an attorney and sue the violating company.

Basically, anything that doesn’t belong on your credit file can be investigated by inquiring with the credit bureaus (Trans Union, Equifax and Experian). When an inquiry is opened, they must contact the original creditor and receive proof that the debt is valid. If they do not receive proof within 30 days the disputed information must be removed. The credit bureau in question will then send you a free, corrected credit file. Note, this dispute process is not to be abused for knowingly valid debts. By correcting the data in your credit report you can only improve your credit rating. You are also entitled to add a small entry to explain any valid derogatory entry. For instance if it was caused by a unexpected child’s illness, automotive accident by an un-insured motorist or something that was not your fault. Creditors may take this info into account and give you a better rate or terms or extend credit where they normally wouldn’t.

Make friends with the special finance manager at your local car dealership that handles bad credit.

This can only help as many times a loan is made or determined on the finance manager’s personal opinions. They can put in a good word for you or a personal favor or recommendation. Especially if they are at a large dealership and they do a lot of loans. They may be able to throw it in with a package of loans and get you approved or get you a better rate. Do not discount this, I have personally seen this happen.

The special finance manager will also determine how much money you can put down and what payments you can afford. If you are friends with them you will most likely get a much better deal, car and payments.

Look online before you sign the dotted line.

There are numerous online finance companies and websites that may give you better terms and or rate, but you will never know if you don’t check. Just look up the keywords bad credit car loan on Google or Yahoo and you will find plenty of them. Find a few and see what kinds of offers or terms you will get. Don’t be surprised if you are approved, but for a newer car. Many finance companies won’t do loans on cars older than 5 or 7 years or with prices below $5,000.

Buy here pay here.

If you wish to buy a car older than the range most companies will finance, under $5,000, or your credit will not let you buy at a normal dealership (very rare), then there is one last resort – the BHPH (Buy Here Pay Here dealer). These car dealers finance the car themselves and will usually expect weekly payments. Do not expect your car loan with them to be reported on your credit report so it will probably not help your credit. If you miss a payment, they will tow off or repo your car. Then you will have to pay extra repo fees and all payments to get you up to date to get the vehicle back. BHPH is kind of like legalized loan sharking, but for some it is an acceptable or only alternative to riding the bus or walking. Expect high interest rates (whatever the state maximum is) and weekly payments of between $50 and $100 with a sizeable down payment (usually around $2,000 or so depending on the year and price of the car being loaned).

Now, once you have a car loan, do not mess up and miss or make late payments. Your goal is to correct the mistakes of your past and build good credit. If you keep making on time payments and continue to build your credit, with 1 to 2 years you will improve your credit and may even be able to do things like purchase a house or condo and qualify for better rates and terms.

Article provided by MDWholesale.com Headlight Repair and Restoration, a website devoted to automotive and driving safety. For more information please visit www.mdwholesale.com/New_articles.html.

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How Can I Repair My Credit Rating?

By Dean Iggo

If you have had enough with being denied for loans and getting extremely high interest rates for credit cards you need to tell yourself, “I need to repair my credit rating”

The first step to take is to request a copy of my credit report. You can do this online or by mail by contacting any credit bureau. There are three that give you the information for free, they are: TRW, Equifax, and Trans Union Corporation. Look to see if there are any errors on the report such as bills that you have paid that come up as not paid. There are many errors on credit reports all the time which is why it is such a good idea to check your credit report at least once a year. If there are errors report them but make sure you have proof as they will not just take your word for it that you paid a bill.

Debt settlement is a good way to start taking steps to your “repair my credit rating” vow as with any outstanding debt your credit score will fall if you continue to not pay it off. There are companies which can help in debt consolidation but research thoroughly as many times these companies can do more harm than good to your credit. You can go online and research the many debt management companies there are just make sure to choose a reputable one.

The most important thing in repairing your credit rating is pay your bills on time. As long as you do not have any outstanding debts and you pay your bills on time your credit rating will improve over time. Conversely not paying bills will quickly cause your credit rating to fall.

The first thing is finding out if you have a credit problem and asking yourself do I need to repair my credit rating? If the answer is yes then take advantage of the many options you have to do so as it will be financially beneficial to you in the future to do so.

Dean Iggo is the webmaster of EzCreditScore.net - Learn why your credit report is so important with simple steps to repair bad credit

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What Does Establishing Your Credit Imply?

By Mary Wise

Establishing credit means that you are taking steps to make sure that you will be considered a good credit risk. When you buy something on credit, a lender trusts you to pay for it in the future. If you make your payments, the lender will want to do business with you again.
If you fail to meet your payments on time, the lender will be less willing to extend credit in the future or will charge a higher interest rate.

Continued Payments Build a Credit History

If you continue to pay your bills, you'll be considered a good credit risk. You'll be able to get more credit with new lenders or increase your credit limit with your current credit card companies. You'll be successful in obtaining a vehicle loan or a mortgage. However, if you don't pay your bills or always pay them late, you'll be labeled a bad credit risk and credit will be harder to obtain.

Credit Bureaus and Credit Score

Your ability to pay back credit is reported to credit bureaus, which generate a credit report. A credit report is important because without it a lender has no way to determine if you are a bad credit risk. It is often easier for a lender to deny credit than take a risk. With all the information they obtain from creditors, credit bureaus generate your credit report which includes a credit risk formula by which your lenders obtain your credit score.

Your Credit Score will influence the lender decision regarding approval or denial of your loan or credit card request. However, this is not the only purpose that your credit score has. It also determines, in the event that you are approved for the loan you where searching for, the interest rate you will be charged for the money you borrow. Since credit score measures the risk, a lower credit score implies higher interest rates and a higher credit score implies a lower interest rate. Your credit score will also determine the loan amount you will be able to request, the length of the repayment schedule and ultimately the amount of the monthly payments.

If your financial goal is to have convenient access to credit, it is necessary to have a favorable credit history on file with one of the three major credit-reporting agencies. HREF="http://www.speedybadcreditloans.com/">Lenders will ask you to complete a credit application when you are seeking credit, and in the application you'll be asked to give them permission to review your credit report.

Lenders will take the information you've provided in your credit application and will attempt to validate from a credit report. Sometimes they will attempt to verify it on their own, but since research costs them time and money, chances are that they'll rely on your credit report

Mary Wise, is a professional consultant at HREF="http://www.badcreditloanservices.com">Badcreditloanservices.com with twenty years in the financial field, helping people in the process of securing personal loans, mortgage, refinance or consolidation loans and preventing consumers from falling into the hands of fraudulent lenders.
At http://www.badcreditfinancialexperts.com/article/ you will find more useful tips and interesting articles on this subject and other financial related topics.

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Is Your Credit Score Below 675?

By Peter Boston

Getting a credit report is a good idea if you are not sure what your credit score may be. If you are planning on applying for a loan, buying a car, putting a down payment on a house, or simply applying for a credit card, you are going to want to know what kind of credit you have beforehand, and a credit report that includes your credit score is the only sure way of knowing.

The median US credit score is 725. That means half the population with a credit score has a score higher than 725, and half has a score lower than 725. The US average credit score is about 675. If you've been rejected for a loan or credit card, your credit score is probably below the national average. A credit report will help you figure out why.

The good news is getting a credit report doesn't have to be such a hassle anymore. You don't need to make any appointments, fill out any paper work, or even leave your house so long as you have an internet connection. There are a number of different sites that offer you a credit report upon signing up. Prior to applying for a new credit card several years ago I did an internet search. Right off the bat I noticed a number of sites that claimed that they will give a credit report for free, so I tried one of these sites just for the heck of it.

The first site I tried was indeed free, however I still have yet to receive a credit report from them. They required a credit card number, which I gave them, and a bunch of other personal information, and then said that I would receive my credit report in the mail. Well, its several years later and I have not received that credit report yet. Fortunately, they did not charge my account for anything, but nevertheless I regret ever signing up with them, and still have some concern about what they are doing with my credit card information.

Your best bet, I soon learned, in getting a credit report is to use one of the well known credit reporting services such as Experian, or Equifax. They will charge you a small fee, usually around $30-$35 USD, if you want a report with your credit score. Getting an accurate credit report and knowing your credit score is well worth the fee, however.

Overall, my advice before getting a credit report is to spend a few minutes researching different credit report sites. Don't be fooled by offers of free credit reports, because there are likely strings attached. Sometimes what's called free really is not. Additionally, there is always the danger that the site you are signing up on is a complete fraud designed just for collecting peoples' personal information for illegal use. It is not as likely as it used to be but I would not use any site that is not based in the US, and doesn't have a street address and telephone number. Looking into it a little before signing up for a credit report may save you some headaches

(c) 2006 Peter Boston is an attorney, writer, and the editor of the profacere.com website, a tips and resource site to refinance a second mortgage, get a bad credit payday loan, or improve your FICO credit score, updated daily on the credit blog.

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