Auto Loan - Obtaining an Auto Loan With Bad Credit

Many people with low credit scores or a bad credit rating assume that they are automatically denied when it comes to obtaining financing for a new or used car. While that might have been the case a few years ago, obtaining an auto loan when you have bad credit is possible. With a little research and work, people with bad credit can obtain a car loan that can be used to finance the purchase of a new car. If you have a low credit score or a bad credit rating, the following tips can help you obtain the financing you need.

When applying for an auto loan with bad credit you should first obtain all your information from the credit reporting agencies. Federal laws require that all three major credit reporting agencies must provide you with a copy of your profile for free. Your credit reports will show you what debts are being reported, if you are delinquent in any bills, and exactly how low your credit rating really is. Obtaining your profile will allow you to see exactly what your credit rating is, and how you can improve it.

After you have obtained a copy of your credit profile, you can work at cleaning up what is on that credit report. Sometimes what is being reported on those credit reports is either inaccurate or should have been removed as it is past the standard seven year mark. Writing a simple letter disputing what is on the credit report can help clean up and possibly improve your credit score. It will take two to three months to remove the stuff from your credit report but disputing mistakes can significantly improve your credit score and give you access to better interest rates.

If you are having difficulty obtaining an auto loan due to your bad credit you may want to try applying at several different banks, financial institutes and online car financing companies. Every company has a different set of qualifications, and some even specialize in offering people with low credit ratings loans. Some people with bad credit ratings are afraid to shop around for loan quotes for fear it'll lower their credit rating. However, if you apply for loan quotes within a month of each other they only count as one quote on your credit report. Getting a car loan might be difficult if you have a bad credit score or rating but it is not impossible. Shopping around for loans, and cleaning up your credit report can help you obtain the financing you need.

About the Author: Chris Goodman has been in the auto refinance and lending business for more than 20 years and has assisted thousands of consumers with their car loan needs. He is an expert on car loans and car financing. Find more information at online at OpenRoadLending.com and see how easy it is to get your next car loan.