| Used car loans are usually for smaller principal | | | | to repair these things when they go out, you'll want |
| amounts than new car loans, so, if you have bad | | | | to get a used car with a warranty. If the dealership |
| credit, you may be better off financing a used car | | | | you're purchasing it from does not offer warranties, |
| purchase. However, financing a used car has several | | | | take the car to a mechanic before buying it. If the |
| pitfalls -- you won't want to continue making | | | | dealership is not a predatory lender, they should have |
| payments on a car that doesn't work anymore. Read | | | | no problem with you taking the car to an outside |
| this article to find out what to watch out for when | | | | mechanic in order for an opinion on the car's |
| applying for a bad credit used car loan: | | | | condition. If they refuse to allow you to do so, |
| Car Costs More Than it's Worth | | | | they're probably not a reputable company. |
| If the car you're buying is worth less than the | | | | Buy-Here-Pay-Here Car Lots |
| amount of money you're trying to borrow, you're a | | | | Buy-here-pay-here car lots generally charge high |
| lot less likely to get approved for your loan. For one, | | | | interest rates, have poor cars, and don't report to |
| it represents a much higher risk to your lender; if you | | | | the credit bureaus. For a person trying to repair their |
| can't repay the loan, they may not get back all of | | | | credit, this is the worst deal you could agree to. |
| the money they lent you. Secondly, you'll be | | | | You're much better off trying to secure a loan |
| upside-down in your loan. This can damage your | | | | through a bank. While banks generally charge higher |
| credit even more than missing payments. | | | | interest rates on used cars than on new cars, their |
| Car Has No Warranty | | | | rates are still lower than those of buy-here-pay-here |
| If the car you're buying is used, then it's likely that it | | | | car lot loans. You're best bet is to avoid these car |
| will have some mechanical wear. If you can't afford | | | | lots entirely. |