Are you looking for the chance to refinance a car loan? What if your credit is not the best – can you still be approved? There are many lenders today who are willing to work with people who have bad credit, but you cannot simply expect to be approved without some effort on your part. After all, as a low credit customer, you put the lender at a greater risk to let you borrow money from them, so you should be able to give them good reason to do so. The purpose of a refinance car loan is to take advantage of lower prices given to those with high credit. However, here are some tips to increase your chances of being accepted despite your detrimental credit score.
The first tip is to set aside money each month for higher monthly car loan payments. If your goal when you refinance car loan is to achieve a lower interest rate, you must prove to lenders that you can afford higher rates, which will help you be approved. Remember that going with a short term loan will cost you more per month, but more of your payments will go toward the principle and you will pay off your loan much faster.
However, if you need a lower monthly payment to keep your car, you may want to opt for a longer term loan. You will pay more interest over time, but the payments will be more manageable. This is worth it to many people who want a refinance car loan. If you are confused about which option to take, you can use a car loan calculator online to help you figure out how much you can afford to pay on a car loan each month based on your income and expenses other than this loan. You should choose a number that is near the top of what you can afford if you want to save money overall, a lower number if per-month savings is more important to you right now.
The final and possibly most beneficial tip in being approved for a bad credit refinance car loan is to add a cosigner to the deal. Their information as well as yours will be given during the application process. Choose a loyal, dependent family member, like a parent or grandparent, to help you. Their higher credit standing should help convince the lender to approve you for the refinance auto loan you desire.
About the Author: Chris Goodman has been in the auto finance business for more than 20 years and has assisted thousands of consumers with their car loan needs. He is an expert on a refinance car loans and auto financing. Find more information at online at www.OpenRoadLending.com and see how easy it is to get your next car loan.