Explore Auto Financing Options: What to do when the Bank Says No?
Posted: Feb 23, 2019
The most important part of getting a car is figuring out the financing required to make the purchase. While there are a number of ventures from where you can seek auto financing, a bank is often the first choice of many buyers. But banks do not always approve your auto loan request as they have strict rules and stringent procedures to follow. However, there are numerous sources that can provide you with the necessary funding for buying your next new car.
Different Auto Financing Opportunities for You
1. Private Money Lender
Car buyers opt for a private lender when a bank rejects them. It can be any one from your relative, friends or neighbors. Usually, real-estate security is involved in the deal. If you are not getting an auto loan from any source, a private money lender can help you. However, the loan you receive from him will be charged at a much higher interest rate due to the increased risk factor. A private money lender will have a flexible approval process but at the cost of an expensive auto loan deal.
2. Buy Here Pay Here Dealership
The dealerships that have a ‘Buy Here, Pay Here’ policy act as banks and provide auto financing, mostly for people with bad credit history. While a BHPH dealership may help you obtain an auto loan, it surely comes with a price. Usually, they have huge interest rates and hidden fees associated with them. Also, due to the less probability of BHPH dealerships reporting your credit to major credit bureaus, you may or may not improve your credit score.
3. Captive Financing Companies
A captive financing company is a subsidiary to a parent auto manufacturing company. It provides auto loans to people who are willing to purchase from the manufacturing brand. Captive financing is a convenient way to gain information and receive an auto loan when you set out to purchase a car. However, you usually do not get an auto loan for a longer term and many captive financing companies inflate the interest rate in order to gain profits for the parent manufacturing company. It means you will have to shell out more money than usual.
4. Online Auto Financing Companies
Online auto financing companies have made a strong impact on those looking to buy a new car. With the onset of technology, you have access to numerous auto loan quotes when traditionally you would have required to visit each dealer/bank individually. Make use of utility tools such as auto loan calculators, monthly car expenditure calculators, free credit scores and DTI ratios available on the internet to make an informed decision. Opt for online financing to enjoy simple, faster auto loan approval and reasonable interest rates.
Get in Line with Online Auto Financing Companies
While the bank was a traditional source of financing, there are many pathways open now. Technology has played an important role in our lives in the past few years. The presence of online auto financing companies gives you time to gain knowledge of the available cars, ascertain your choices, and obtain the best loan quotes. Thus, when you set out to purchase your next car, just hit up Google and find the best online car financing companies in your area.
Do not worry if your local bank has rejected your loan application. Contact a reputed bad credit instant auto financing company online. Submit an online loan application and get approved in just 2 days. Apply now for no down payment auto loans.
Being from the auto financing industry, I know that it is extremely diverse. New loan programs are launched daily which create confusion among car buyers.