If your credit isn’t looking too flash, you might be wondering if you have any hope of getting a car loan. Luckily, having bad credit isn’t all doom and gloom but it can make things a little different when applying for finance. You also need to know where to look!
What is bad credit?
A person’s credit score is a number, between 0 and 1000, based on your credit history. The term ‘bad credit’ suggests a low credit score. It typically means in the past, you haven’t paid your loans or bills on time (or haven’t paid them at all).
Credit scores are calculated from several factors – including payment history, amounts owed, credit length, types of credit, and new credit.
Both missed payments and defaults can show on your credit report, affecting your score. Missed payments show for two years, while defaults can be seen for five years.
A default is a failed payment on an expected debt, such as a power bill, phone bill, credit card or loan payment. A missed payment becomes a ‘default’ when a payment of $100 or more is at least 30 days overdue, and the provider has attempted to recover the money. Defaults show on your credit report for five years.
How do I know if I have bad credit?
It’s easy (and free) to get a copy of your own credit report. You can request it online from a few credit reporters: illion , Centrix, Equifax. Credit scores are not included in the free versions of these reports, but you can view your credit score for free at Credit Simple
A credit score is presented as a number between 0 to 1000, with most scores between 300 and 850. Basically, the higher the number, the better your score.
What to know about bad credit car loans
It’s still possible to get a car loan with bad credit. But it does influence where you might get approved and what your interest rate will be. Since bad credit means higher risk for a lender, many lenders won’t be able to offer finance in this situation. For the same reason, your credit rating is the most influential factor in determining your interest rate.
Why can I get a bad credit car loan from Sprint Finance?
If you’ve got bad credit, it’s not all bad news! Here at Sprint, we like to look at your full application. A couple of glitches here and there can still get approved, especially if you’ve got stable income and can afford the repayments. We like to make things happen, and always like to get you a fair deal.