Second Chance Loans

 

Second Chance Loans and Getting “Guaranteed Financing” in Enterprise, AL

A second chance is something everyone understands, but you might not have heard of a second chance loan. To put it simply, it’s another name for a bad credit loan, but it refers to enabling shoppers with credit damage to get a second chance at credit approval after getting a loan request denied by a conventional source. Second chance loans are categorized as either dealership-financed or bank-financed loans.

If you’re looking for a second chance loan, you might consider a dealership-financed loan. You’ll usually find these types of loans at a “buy here pay here” dealership because you will make your monthly payments directly to the dealership from which you purchased your car. These dealer-financed second chance loans are also called “buy here pay here” loans. If you’re buying an early-model car or truck with high total mileage, you might consider applying for a dealership—financed loan. You’ll get guaranteed financing in the form of a relatively high down payment to the car’s value, but a dealership can usually offer you a lower interest rate (a point or two, at least).

If you’ve got your heart set on a new or late-model vehicle with low mileage, you might want to look into a bank-financed loan. With this type of second chance loan, you’ll make your payments to a bank that holds your vehicles title instead of the dealership. With a bank-financed loan, you’ll usually get better rates for newer vehicles because the lenders know most buyers will likely make their payments on time for a vehicle that is more reliable. You can even finance new vehicles with bank-financed second chance loans.

No matter what type of second chance loan you’re looking for from our Enterprise, AL dealership keep these tips in mind and shop smart:

  • Know your credit score and the information in your credit profile
  • Buying a car with a sub-prime loan is different than buying a car with a traditional loan, your income and current debts will be perused by your lender and you will be budgeted for a monthly payment
  • Research insurance prices on comparable cars in the price-range you’re approved for, insurance rates can differ greatly between various makes and models.
  • If you’re buying a used vehicle, have it inspected by an ASE certified mechanic before buying