Getting a car financed got a lot more challenging after the credit crunch, but we help people get approved on a daily basis. It’s advisable to work with a dealer or lender that has your best interests at heart. We’ve established an unparalleled network of dealers and lenders who can help you get behind the wheel of the car or truck you want, no matter your credit score. Just complete your loan application, and you will be a few short steps away from the new car you want.
Bad Credit Car Dealers in Covington, KY
Dealerships that have sub-prime finance divisions are, in many cases, referred to as bad credit dealerships. Generally speaking, these dealers offer:
- Interest rates that are fair.
- Down payments you can afford.
- Vehicles that have less mileage.
Your credit and income dictates how much car you can get financed. Typically, if you have adverse credit, the upper limit of what you can borrow is 6 to 8 times the amount you make on a monthly basis. For the Covington resident who makes $2,462 per month, this is $14,772 to $19,696. That being said, you’d be wise to borrow less than you can, restricting your monthly payment to just 10% of your income–$246, in this example.
Submit your application to have a finance expert confirm your options.
Covington Auto Loan Rates: How to keep Them Affordable
Securing the best interest rate possible is absolutely essential.
Consider what you’ll wind up owing in interest at an interest rate of 3.50% as compared with 7.00% or 11.00%.
|Good Credit||Decent Credit||Sub-prime Credit|
|Rate||3.50% APR||7.00% APR||11.00% APR|
Thank goodness there are steps to take to minimize the rate of interest on your loan.
- Credit History: Challenge any inaccuracy showing up on your credit report which could increase the APR rate you’ll have to pay.
- Down Payment: Put 20% down on your vehicle, which will help reduce lending risk, resulting in a more affordable rate.
- Debt-to-Income: Lending companies prefer borrowers who have minimal other debt, so paying down as much as you can may be beneficial.
- Length of Loan: Financing for 60 months or less could result in a lower rate of interest.
- Age of Vehicle: It doesn’t cost as much to finance a vehicle that’s new–provided the purchase price is the same.
Covington Buy Here Pay Here Dealerships
In house financing, also referred to as buy here pay here financing, continues to grow, largely because so many people’s credit scores took hits on account of the housing market and slow economy. These car lots offer financing on the lot, whereas most dealerships utilize one of their affiliated lenders, and they typically don’t reject anybody.
You will discover that preowned autos are the only thing available, and these aren’t zero down car loans. Quite often, the down payment is set at the vehicle’s value at dealer auction, and you could find yourself paying thousands in finance fees through excessive rates. And if that weren’t a problem, these dealers very rarely work with the credit bureaus, so you could make all of your payments month after month with no lift in your FICO score.
Can This Raise Your FICO Rating?
If you don’t miss payments, a car loan can actually boost your credit score. However, this benefit isn’t automatic. You must repay the loan as contracted, making every month’s payment by its due date. Your score will not increase the day you pay back your loan. Rather, its increases over time as you continue making payments on time. You don’t want to underrate the advantages of an increased credit score. The benefits are wide ranging, and all you need to do is pay your lender in full each month.