Bad Credit Car Finance - Banks Widening Their Nets
Bad Credit Car Finance - If you are looking for a vehicle and have a low FICO score - below 680, which is considered a "subprime auto loan" - filling out a bad credit auto loan application need not cause you too much stress.
In the last several years banks like Capital One Financial Group, Wachovia, and Wells Fargo have widened their customer base base to welcome the "bad credit auto loan application" segment and include those with lower and lower FICO scores.
Opening up potential auto loans to bad credit auto loan candidates is more of a neccessary evil these days - the number of bad credit car finance applications is on the rise. According to Standard and Poor's, the 108% increase in subprime auto loans recorded in 2005 and 2006 will likely continue throughout 2007- 2008.
Basically, if auto lenders want to compete for your bad credit auto loan application, they are being forced to open their doors to riskier borrowers just to sustain growth. The number of AAA credit candidates is declining.
One reason for Bad Credit Car Finance providers are taking on more risk could be that the majority of the bad credit auto candidates are "renters" rather than "mortage holders". Renters are not experiencing the sticker shock of an ARM radically adjusting up. The higher monthly payments forced on homeowners leaves fewer dollars left to spend on a car payment.
Bad Credit Car Loan Candidates Need to Shop
You need to shop multiple dealers even if you have bad credit. Many dealers are "driven" by sales quotas, not profit per vehicle. With low a FICO score, you won't get the best rate of course but may be able to get better interest rate if you make it crystal clear you are comparing the same vehicle at multiple dealers. Competition is always the best equalizer.
Car Loan With FICO Score Below 600
FICO score below 600? Visit our bad credit lender evaluation: Bad Credit Auto Loans. These lenders specialize in helping bad credit borrowers get approved for car loans with FICO score below 550.