What is a bad credit car loan?
A bad credit car loan is a car loan specifically designed for borrowers with bad credit. Borrowers with bad credit who find it difficult to get approved for a standard loan may be able to get approved for a bad credit loan. Lenders offering bad credit loans are more willing to overlook issues with bad credit – so even if you have bad credit, you may still be eligible for a loan.
About Bad Credit Car Loans
Not everyone is lucky enough to have good credit. Unfortunately, borrowers who don’t have good credit can find it much more difficult to get approved for a car loan. Lenders will generally look at an applicant’s credit file first, and if that credit file shows a chequered credit history, the application may well be denied.
The reason why lenders put so much faith in the credit file system, is because each credit file allows the lender to determine the applicant’s level of risk. If the applicant has not dealt with credit well in the past, it suggests to the lender that they may not deal well with it in the future. This may make it too risky to lend to that applicant.
But that doesn’t mean people with bad credit shouldn’t be allowed access to car loans. Borrowers who have been denied standard loans on account of their bad credit history may be able to get approved for a bad credit loan instead. Bad credit car loans work in much the same way as standard car loans, except for the fact that the lender is more willing to overlook bad credit.
If you have bad credit and want to apply for a bad credit car loan, just tell us what you need and we will search a range of lenders to provide you with a selection of bad credit loans. Then it’s simply a matter of finding the loan that matches your needs.
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Features and benefits
- Same day approvals for a faster response
- Low rates and flexible terms
- Independent advice from a Personal Advisor
- Pay a lower interest rate by using your car as security
- Fixed interest rate for the life of the loan
- Choose weekly, fortnightly or monthly repayments
Apply for a loan
If you’re looking for a car loan but are worried about your bad credit rating, find out more about bad credit loans from Car Loan World today. Even if you have bad credit, we could find a car loan to suit your needs. Apply now to get started.
to Keep in Mind
Bad credit car loans offer a great way to access credit if you have bad credit history. However, before you apply for any loan you should always find out more about it. While bad credit loans have their advantages – namely, offering credit to borrowers who cannot get credit elsewhere – they can also have their disadvantages too.
Lenders that offer bad credit loans overlook borrowers’ bad credit, but that also means they are taking on a certain amount of risk. The borrower may not be that good with credit and may default on their loan, leaving the lender high and dry. For this reason, bad credit lenders can charge more for their loans to make up for the risk factor.
Borrowers may have to pay more in fees or interest on bad credit car loans compared to the rates and fees on standard loans. That being said, borrowers can use bad credit loans to improve their credit rating, so they can move up to a standard loan next time they borrow.
It’s also worth bearing in mind that unfortunately, not everyone is eligible for bad credit loans. The lenders we work with cannot accept borrowers on a disability pension, aged pension, New Start allowance or youth allowance, as well as people who are currently bankrupt.