Getting a car loan with bad credit
Types of Bad Credit
No one wants to hear about bad credit, and moreover, no one wants to have bad credit. However, what many people don't understand is there are different types of bad credit.
Situational Bad Credit
Situational bad credit involves consumers with a situational credit problem. You can usually identify a significant economic disaster or event that caused the bad credit situation. For example:
- Ilness or injury
- Loss of employment
- Bankruptcy due to medical problem
Bad Credit or No Credit
Consumers with bad credit or no credit may have numerous unapplied for charge-off accounts such as bad checks, unpaid medical bills and unpaid utility bills, or unresolved repossessions over two years old.
Real Bad Credit
Consumers with "Real bad credit" are consumers with credit problems that cannot be isolated to a single event and usually result in a long term history of bad credit. For example:
- Multiple bankruptcies
- Multiple repossessions outside of bankruptcy at different times.
- Significant bad credit after a bankruptcy.
- Currently delinquent on all existing obligations.
- Unresolved repossessions less than one year old.
- History of writing bad checks over a long period of time.
Loans for Every Credit Type
Even if you have "situational bad credit", "bad credit" or "no credit", or even "real bad credit", there are a multitude of companies that will work with your special financing needs to obtain a car loan with bad credit. When considering applying for a "bad credit" auto loan, do your research.