TopConsumerReviews.com Best Auto Loans
      March 29, 2020

Home  >  Auto Loans  >  Articles

Best

Auto Loans

  1. LendingTree
  2. LendingClub
  3. My Auto Loan
  4. Cars Direct
  5. Road Loans
  6. Automotive
  7. Auto Credit Express
  8. OneMain Financial
  9. USAA
  10. Instant Car Loan
  11. Web 2 Carz

Your Information Is Secure
Worry Free Car Care Manual Newsletter

Compare Products

  • Select any 2 companies in our reviews to compare them head-to-head!
  • Compare

Latest Reviews

Auto Warranties

Bad Credit Loans

Batteries

Cheesecake Clubs

Creatine

Credit Monitoring

Diabetes Supplements

iPhone Repair

Popcorn Clubs

Prenuptial Agreements

 

Related Articles

Are Auto Loans Through A Car Dealer A Good Idea?

Auto Loans Versus Auto Leases

How Much Car Can You Afford?

How Your Auto Loan Can Be Affected By Your Credit Rating

What To Look For When Shopping For An Auto Loan

 

Top Consumer Reviews Articles

TopConsumerReviews.com provides unique articles that you won't find anywhere else on the internet. These articles are designed to help you make the most informed decisions possible.

How Your Auto Loan Can Be Affected By Your Credit Rating

Our lives are dominated by numbers. As students, grade-point averages were the numbers which ruled our lives. In the working world, the success or failure of any business is determined by the financial bottom line are you in the red or the black? As individuals, numbers fill our lives, too. What is our bank account balance? What is the interest rate on our loans and credit cards? All of these numbers, when put together, can affect everything we do.

Take, for example, a very important number: credit rating.

A credit rating is part of your credit portfolio. Every financial decision a person has ever made, from their first credit card to their student loans, are part of the report. Any missed payments a person has ever had also are part of the report and can have a negative effect on any future financial dealings.

There are three credit reporting agencies in the United States: Equifax, Experian and TransUnion. These companies collect financial data on individuals, and then use a mathematical algorithm formula, developed by FICO, to generate a number between 300 and 850. A high, three-digit credit score indicates the person is of solid financial standing and is considered low-risk. Individuals who have credit ratings under 500 are considered high risk for loans and other financial dealings.

FICO also groups lenders together based on their overall financial history. Lenders who occasionally get behind on their bills are classified in a separate category from chronic late-payers. Prior to 2009, anyone who failed to pay on any loan whether it was an occasional issue or a chronic one was lumped together by FICO, creating an unfair credit rating for some individuals. With the changes, it helps those who have fallen behind a few times to still be able to achieve fair dealings with creditors.

However, for those chronic late payers, one of the areas which can be affected by a poor credit rating is an auto loan.

Unless you are lucky enough to have enough savings to pay cash for a vehicle and most people do not then chances are you will need to take out a loan to finance it. The new way FICO calculates its credit scores has a tremendous impact on the auto loan industry. People with only one major credit account in delinquency are likely to still have a good chance to get a fair interest rate on a loan. However, borrowers with a history of delinquent accounts will find themselves being either completely denied for a loan, or saddled with an extremely high interest rate.

A FICO score of 720-850 guarantees an annual percentage rate of no more than 6.3 percent, while those in the bottom tier of 500-589 can expect an interest rate as high as 18.5 percent. Borrowers whose credit score falls below 500 will likely be denied any kind of auto loan, even one with an extremely-high interest rate.

If you are in the market for an auto loan, the best course of action is to request your credit report and a copy of your credit score so you are aware of whether you may have difficulty in obtaining a loan. Individuals are permitted one free credit report from each of the three credit-reporting agencies annually. However, credit scores are not included and must be purchased separately.

Car buyers saddled with debt after signing up to loans they can't afford

Some car buyers are being saddled with repayments they just can't keep up with after being talked into loans they can't afford, or unknowingly signing up for extra insurance.

Published:  Thu, 26 Mar 2020 15:24:00 GMT



Bank of America waives fees, defers payments on credit cards, some mortgages and auto loans during coronavirus

Bank of America cardholders are receiving financial relief during coronavirus. Citi, Chase, Capital One, Discover, Apple and American Express have made similar announcements.

Published:  Wed, 25 Mar 2020 17:08:00 GMT



Carvana shares soar after huge auto loan purchase deal comes through

Tempe-based Carvana (NYSE: CVNA) said in a regulatory filing that Detroit-based Ally Financial will provide up to $2 billion for the purchase of finance receivables over the next ...

Published:  Tue, 24 Mar 2020 11:29:00 GMT



What Is an Upside-Down Auto Loan?

Owing more on a car loan than the vehicle is worth is a common problem for today's buyers. With high-priced vehicles, small down payments, and five-year or longer loans, having negative equity can be ...

Published:  Tue, 24 Mar 2020 09:51:13 GMT



Coronavirus Car Deals: 5 Kia Models With 0% Financing and Why You Should Buy Them

On top of all that, a selection of new Kias are available with 0% percent APR financing. Related: Should I Buy a Car During the Coronavirus Pandemic? Unfortunately, two of Kia's newest models - the ...

Published:  Tue, 24 Mar 2020 15:18:00 GMT



Share Us!   

Home      About Us      Terms & Conditions      Privacy Policy      Contact Us      Disclosure