Start Fixing your credit today!!!  The only thing you legally need to supply the credit bureaus for a copy of your report is your name, your social security number and a legal mailing address (P.O. Box is a legal address). If you don't want to chance harassment by creditors at this time, it may benefit you to acquire a P.O. Box. Did you know that many of the collection agencies are owned by the credit bureaus?

Used car financing
Author: Jakob Jelling
Purchasing or leasing a new vehicle can be an expensive proposition that you may not be ready to commit to right now for many reasons. But if you do need a vehicle this only leaves you with one option purchasing a used vehicle. A purchasing a used vehicle can save you thousands of dollars in interest payments, especially if you do not have perfect credit. However, finding a lender for a used car loan can be very difficult.

Any time that you are considering a financed solution the first thing you should do is examining your credit report. Looking at you credit report will do several things for you. It will give you an idea of how much interest you can expect to pay, let you know how creditors will view you, indicate your odds of getting a loan and allow you to verify and correct any mistakes that you may be there. This is very important as 1 out of 4 credit reports usually contains errors that can result in you paying higher interest rates.

Once you have an idea as to what to expect for interest rates and perhaps who will finance you can begin to shop for your loan. A bank is a good place to start if your FICO score is more than 600 but there can be several bottlenecks to your getting a loan. In order for a bank to issue a car loan for a used car it must meet certain standards. Each situation is a little different but generally your car must be less than 5 years old and ideally be less than 3 years old, have low mileage and still have a warranty. The reason for these requirements is to ensure that the vehicle still is of value if you default on your loan and to make sure that it is not going to be a write off while repaying the loan thus encouraging you to walk away from the payments.

If you do get an auto loan do not be surprised if the term for repaying the loan is 3 years or less. Since the vehicle will depreciate in value faster than a new vehicle would the terms for the loans are normally shorter. If you are not able to secure an auto loan and you have good credit you may wish to seek a line of credit or a personal loan from the bank. Since this loan will be considered an unsecured loan you will pay a higher interest rate than you would for an auto loan but this rate may be lower than the rates offered by a third party lender. However if you are looking to finance a privately sold vehicle this may be your only option.

The next best financing option, and sometimes better, is the seller of your vehicle. Most vehicle lots have a few lenders that they work with on a regular basis who can help almost anyone in any situation. The advantage of seeking financing at from the lot is that they know who to talk to and how to get their vehicles financed. This can save you a lot of time and hassle however it comes at a price. Most third party lenders charge a higher interest rate and the auto dealer may add another couple of percent to the interest rate as a handling fee. The only way to offset these higher interest rates, other than shopping around a bit, is to be a shrewd negotiator and getting a really good deal on the vehicle.

As you can see getting a used car loan can be a little difficult and may cost you more than a new car loan will but it is possible to do. You must carefully examine your needs and then weigh the value of a new car verses a used car to determine if financing a used vehicle is even a viable solution for you. If financing a used vehicle is your only option ensure that you negotiate the best deal possible and apply as much money as you can as a down payment in order to reduce the overall amount of interest and total cost of the loan.

About the Author

Jakob Jelling is the founder of http://www.cashbazar.com. Visit his website for the latest on personal finance, debt elimination, budgeting, credit cards and real estate.

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