Free 60 Second Application with 98.9% ApprovalAuto Loan Scams and How To Avoid Them
All borrowers must follow certain guidelines while applying for auto loans in order to stay safe against scams. Circumstances can be even more dubious for applicants with less than perfect credit. These people in particular need to make smart decisions while dealing with their bad credit auto loans company in order to avoid auto loan scams. Any bad credit auto loan applicant must have a thorough understanding of the process and plan well in advance.
At Valley Auto Loans, we have been instrumental in providing hassle free auto loans to many bad credit car loan applicants. Over the years, we have observed that many applicants often get into trouble by signing up for a car loan deal that is beyond their means. The simple tips shared in this article would help you make an informed decision and stay well protected against such auto loan scams or car buying scams.
Step one to avoiding auto loan scams
The first and foremost task for you before visiting a car dealer is to be aware of at least one of the FICO scores for you and the contents of your credit report. Always remember that you have a good chance of qualifying for a regular auto loan from a credit union, bank, or captive finance company, if your credit score is more than 640. Bad credit auto financing is required only for applicants with a credit score less than 640. Your credit report information and credit score must be at your fingertips because the processes for regular and poor credit financing are different.
Step two in avoiding auto loan scams
The next important thing for you to do is that of determining a budget for your car. Apart from payments to be made for the car, this must also include car insurance with full coverage and the fuel expenses. Now determine your payment to income (PTI) and debt to income (DTI) ratios by comparing the above mentioned expense with your income after expenses.
All dealerships would try to sell you different types of back-end products, especially those running car dealer scams. In case of a 60-72 month loan, you may consider purchasing gap insurance. The same applies for car loans with less than 20% down. Used car buyers can also opt for extended warranty, if available for a reasonable price. However, it is always a better idea to avoid add-ons like paint protection, rust proofing, window etching, etc.
Your choice of car dealer is extremely important, particularly if you do not have an impressive credit history. It is certainly a great idea to ask for recommendations from your family members, colleagues, and friends. Before deciding to deal with a company, check with the Better Business Bureau to find out the reputation of the dealer in the market.
A much easier alternative for any car loan applicant would be to visit our website and explore endless opportunities. At Valley Auto Loans, we have built a nationwide network of bad credit lenders to offer you easy and safe options through our massive auto loan network.
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