You know you need a bad credit auto loan. What do you do for a living?

Go from dealership to dealership hoping for the best, usually settling on whatever vehicle you’re pushed into?

· Or get pre-approved and walk to authorized car park and ready to do business in the vehicle of YOUR choice?

· Obviously, getting pre-approved is the best way to go! Bad credit auto loans are available through some very good lenders.

But before you start shopping, we’d like to give you some great advice. But if you’re in a hurry, you can visit our 1-800BadCredit site and go directly to our recommended lenders.

Know your credit history

Rates and terms will vary based on your credit scores. This can mean the difference between a new or used vehicle; a highly equipped vehicle or a slightly reduced one. Before you assume you need to deal with a creditor who specializes in bad credit, check your credit score.

Credit scores range from 350 to 800. If your score is below 600, you are in the “bad credit” range. This doesn’t mean you can’t get a loan, it just means you should probably get pre-approved through a bad credit auto loan bank before you start shopping for a vehicle.

A pre-approved auto loan from a lender that specializes in bad credit auto loans could save you 2-10% (I know because I used to sell cars in Phoenix, Arizona).

It’s a good idea to take out your credit every 6 to 12 months and review it.

A pre-approved bad credit car loan puts you in the driver’s seat!

Regardless of your credit score, getting preapproved for an auto loan gives you more options when you hit the car park. Once you’ve been approved for a car loan, you’ll be in the driver’s seat! You are free to buy the BEST vehicle in your price range!

You should choose the one that best suits your personality and needs.

Leave room for warranties and GAP insurance

With all the computer equipment in cars today, what used to be a simple fix is ​​now very complex. The average auto mechanic bill today can be more than $400. And that’s for something simple like a window motor!

GAP insurance pays the difference between what you owe on the vehicle and what the insurance company gives you if your car is totaled. This is a must for any vehicle financed today!

Most bad credit auto loan lenders will give you “room” to put these items. For example, if you get approved for $10,000, they’ll really give you about $13,000 (provided you cover taxes, title, and fees and/or purchase an extended warranty or GAP).

HOWEVER, every lender is different, so you’ll want to ask if they allow this type of increase before you start shopping. If not, you will need to purchase a vehicle that costs between $2,000 and $3,000 less than the approved amount in order to purchase an extended warranty and GAP insurance.

Take your time and find the vehicle you want at a reasonable price

Just because you have bad credit doesn’t mean you should be forced to buy the worst vehicle on the lot! If you’re buying a used vehicle, request a report from Car Fax. If they don’t give you one, don’t buy the car. Always be an informed shopper!

Don’t buy more vehicles than you’re approved for and think you’re going to trade up to your pre-approved amount! The best way to find out a good value on a used vehicle is to order a sheet from Kelly Blue Book. A good price should be between the wholesale and retail price. Don’t let the lender sell you a vehicle for more than it is worth! Make a reasonable offer between wholesale and retail value and if they don’t, move on! Also, if they don’t want to share Kelly Blue Book information with you, then leave and go somewhere else. That’s the power of pre-approval!

Another great feature of pre-approval is that the bad credit auto loan lender will not let you have a car that is outside of Kelley Blue Book’s “book value.” So if a dealer is trying to pressure you once they find out you’re pre-approved (and won’t let you get credit from them to get a loan themselves), they’ll help you find a vehicle that’s safe. trustworthy, and not an overpriced scam!

Know your trade-in value

Most bad credit auto loan banks will give you an estimate of the value of your vehicle as part of the payment. You can also check it out for yourself at kbb.com. But remember, Kelly Blue Book is just a tool. Car dealers also check auction reports to see what price their vehicle is selling for on the open market in their area. Don’t let the dealer fool you with a low trade-in value, but don’t ask for the maximum either. Kelly Blue Book Fair Trade Value is a fair price. If you can get more than one local source, then by all means go that route. But if the retail value is between $4,000 and $8,000, don’t ask for $8,000 (unless your car is a museum piece that’s never been driven, it’s probably not worth the maximum amount).