The Best Way for People to Use Loans to Finance a Car

So you are in the market for a car, but you've got bad credit, or your cash flow is hurting from the debt you've built up over the years. We will take a look at a couple loans you might be familiar with and see which one would be best for your needs. Although your number one goal is to own a car, you ideally would want a loan that serves two purposes. One is a loan you can actually afford, and the other could be one that might help improve your credit score.

·         Guaranteed Auto loanFinancing of Cars are direct from an auto lot. They consist of a down payment and a fixed number of loan payments over time. These payments are due every week and are made by you in person at the lot you purchased the car.

·         Bad credit auto loans are also called second chance car loans. They are usually only available thru a franchised new car dealer. Although the dealership sells you the car the financing usually takes place through a lender. In this case you will be making payments to the lender once a month through the mail or an electronic payment from your bank account.

·         Deciding between these two types of car financing options is really up to you and your situation. Would you like to work directly with a dealership to finance a car, and make smaller payments on a weekly basis, or would it be preferable to work with a lending company, improve your credit score and pay on a monthly basis.

Advantages and Disadvantages of Bad Credit Auto Loans

The biggest advantage of a bad credit auto loan is that your lender will report your payment to the credit bureaus. The selection of new cars will also be better. You can get loan terms starting at 24 months and can extend to as a many as 60 giving you a much wider choice of vehicles to choose from. However not all franchised dealerships offer this service. Because you are dealing with newer vehicles the selling price of the cars will be generally higher. Remember too that any problems with your payment history will be reflected in your credit score as well as your Fico score. 

Click Here Know About Three Steps to Take  Refinance Of Car Loan  

The Advantages and Disadvantages of Guaranteed Auto Loans

The advantage of guaranteed refinanced auto loan rates is that the cars are usually less expensive. Many people actually prefer to make a payment on a weekly basis. You are making your payment face to face with your agent and you will know each other personally. Guaranteed auto financing often requires no credit check before selling a car, so you might be able to have bad credit and still take out a loan to own a car. However, most dealerships don't report your payment history to credit bureaus. The cars you will be offered are typically older with a higher mileage. For most people it is not convenient to visit the dealer every week to make a payment and the rental terms range from 12-24 months limiting your options for available vehicles.

You can find great auto loan online refinancing options at credit-yogi.com. After you've purchased a vehicle remember to always make your payments on time. If run into trouble down the road don't hesitate to call credit-yogi.com at 1-866-964-9644 to learn more about financing cars and bank repossession. They are available any time for a free consultation.