There is nothing like buying a car and then immediately looking for a used auto lender for your guaranteed auto loan. In the midst of the global credit crunch that hit the market, many well- intended but ill-prepared buyers are being turned down for credit.
Getting their auto loans approved is getting more and more difficult – even for the people who have the most stellar credit scores. There are many questions as a prospective buyer about auto lending but perhaps the biggest concern is that many lenders are just not willing to invest their money in anyone but those with stellar credit ratings because traditional banks and lending institutions are finding the risk way too risky at the moment.
This all may have seemed to have been avoided prior to the credit crisis but since then it is even more difficult explains Sofiya Machulskaya.
The Confusion
Guaranteed auto loans are not really guaranteed at all. In fact, no solution is fool-proof. Not that wasn’t there something to rely on. Many consumers are very curious about the necessity of a guaranteed auto loan and whether or not their loan application would get the green light.
Firstly, some lenders are opening their own automobile lending arms and are in the process of buying up old business as well as setting up shop on every corner in the United States and even in other parts of the world. They are willing to invest in auto lending and although the interest rate may not be the fanciest, what is important is the consumer does not have to worry so much about approval as they will have a lower interest rate and also a choice of loans that they can choose from.
Also, traditional banks and lending institutions are finding themselves in a majority of the same boat, in that they have tightened their profit margins to such an extent that there is no back room for any consumer to get approved but the only people who really stand out are those still in good credit standing. Even with these changes, it is still possible for a buyer with 100% financing to get a fantastic deal on a car.
Guaranteed Auto Loans In A Ranging
Guaranteed loans need the traditional approach of calculating the applicants credit score and determining what type of interest they can afford. This is very time consuming and also, the lenders are loathed to make any personal assessment regarding the applicant says Sofiya Machulskaya.
This is why many car dealers are trying to work with aggregators who will, in turn, pass the loan on to the lenders at a fraction of the fees that they normally pay the original lenders. This impartial decision can save both side of the table and leave the customer with 0% financing.
The Best Deal…
This all comes at a price of course and in order to make things happen, the price is not going to be as great as expected. The goal is for it to be more affordable than the total cost of the vehicle by about 3%. The fact that there are two sides to the coin and the financial institutions are clearly aware that the auto loan market is very competitive, they are trying every trick in the book to get people to turn a blind eye and pocket 0% financing down the road.
But guess what, people are looking for 0% financing and they are willing to negotiate and negotiate until they get it. The fact that a financing deal can still be found is reason enough to get an application in no matter what. Within the free market it is important that consumers are given the choice and responsibility to go out and find it themselves.
Do not trust these lenders. They will not help you to get an application approved. It is best to get all the information to yourself or to hire somebody that knows what they are doing, and do not fall prey to the lenders clever games.
The 20% Down Test
