Bad Credit Auto Loan Refinance – Tips To Increase Your Odds Of Getting Approved

Plan to refinance your auto loan but have bad credit? You can

still find financing at reasonable rates by searching online for

your lenders. Researching rates and terms will lead you to a

good deal, saving you money each month. Increase your odds of

getting approved for the best loans by following these tips.

Think About A Co-Signer

The better your credit score, the better your rates. So if you

don't have great credit, look for someone who does. By having

them co-sign for your loan, you can find yourself qualifying for

much better rates. Lenders look at your co-signers record, but

you pay for the loan.

If you are a couple, you may also choose to use the person with

the best credit score to apply for the refinance auto loan. You

can find out who has the better record by requesting your credit

score online.

Update Your Credit Report

While you can't change your credit report overnight, you can be

sure it is in the best condition possible. Take a few minutes to

review your free copy and make sure all information has been

updated. You may also want to include an open letter explaining

any reasons for your bad credit score. Mitigating factors, such

as a job loss or illness, are sometimes considered by lenders.

Eliminate Old Debt, Hold Onto Cash Assets

Besides your payment history, lenders also look at your debt and

cash assets when considering your loan application. The less

debt you have, the better you look to lenders – especially if

you have a high income.

Cash assets are also important. Lenders like to see at least six

months of cash reserves in the bank. This can mean a savings

account, money market, or CD.

Be Honest With Your Information

More than likely, you will be approved for refinancing. What

rates you qualify for depends on your information. So to get the

most accurate loan estimate, be honest about your credit

background. That way, when you actually apply for the loan, you

will be approved for the rate quoted.

Remember too that not all lenders charge the same rate. A

careful search will bring up favorable rates, even for those

with poor credit. Sub-prime lenders often provide loans on a

point or two

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Written by: Carrie Reeder