Getting the loan you need is often the largest obstacle to purchasing a new car, especially since the economic crisis struck. It’s important that you find a bank or dealer who has experience with subprime auto financing. We’ve spent years building an unrivaled network of dealers and finance companies that want to get you into the car of your dreams. Your vehicle finance specialist will help you set up your loan. After that, all you have to do is visit the your dealer’s lot and pick out the car you want. Visit here to submit your online application.
El Paso Car Dealerships for Bad Credit
If you’ve got weak credit, dealer financing is often the only option you have, since the majority of banks won’t be able to work with you. On the other hand, there are dealers that can get you the loan you need at an affordable rate. In most cases, these dealers offer:
- More reasonable rates of interest.
- Smaller down payments.
- Both new and used vehicles.
Your income and credit will determine how much car you can get financed. With credit problems, you can finance six to eight times the amount you earn on a monthly basis. For the El Paso resident who earns $388 each month, this is $2,328 to $3,104. Having said that, it’s better to borrow a smaller amount, confining your monthly payment to only 10% of your income–$39, in our example. Submit your application to speak with an auto finance professional about your options.
El Paso Auto Finance Rates: How to Reduce Them
If you want to minimize the overall cost of your next car or truck, take steps to lower your rate of interest. This could save you a lot of money over the life of your loan.
In fact, a cheaper rate of interest could save you thousands of dollars, as you can tell from the chart that follows.
|Good Credit||Decent Credit||Subprime Credit|
|Size of Loan||$3,492||$3,492||$3,492|
|Rate||3.50% APR||7.00% APR||11.00% APR|
Needless to say, your rate of interest is nothing short of paramount, and the good thing is that it can be minimized in a range of ways.
- Credit History: Take steps to correct any mistakes you see on your credit report which could increase the rate of interest you’ll have to pay.
- Loan-to-Value Ratio (LTV): Putting more money down normally means more affordable loan rates, given that a smaller percentage of the vehicle is being financed.
- Debt to Income Ratio (DTI): Do you have a ton of credit card debt? Getting that paid down will trim your debt-to-income ratio, which will give you a better rate of interest.
- Shorter-Term Financing: If you choose a shorter repayment period, such as 36-48 months, your interest rate will be lower.
- Newer Vehicle: Banks and finance companies charge steeper rates for used vehicles, as they’re more susceptible to maintenance issues, etc.
Buy Here Pay Here Car Lots in El Paso, TX
Maybe you’ve thought about getting a car loan at a buy here pay here car lot in El Paso? These kinds of El Paso in house financing dealerships supply financing on site, quite often with no a credit check. Seeing as they don’t depend on a standard bank or credit union for approval, they’re able to help an extensive array of customers. Countless people with really terrible credit believe that an in house financing car lot is the only establishment that will be willing to take their credit, despite the fact that Texas bad credit car loans from banks and credit unions typically have lower rates.
Will a Car Loan Improve Your Credit?
If your credit has taken some knocks, you may be worried that financing a car will only decrease your score yet further. However, financing a car is a good way to improve your credit. When you make payments in a timely manner, you prove to banks and lenders that they’ll likely turn a profit lending to you, as it’s unlikely you’ll go into default. Of course, this works in both directions: you can hurt your credit worse if you go delinquent on your payments. To ensure you never miss a payment, consider intelligent options such as automated payments.