What is a Subprime Auto Loan?
A subprime car loan, or special finance car loan is based on a higher interest rate loan as compared to prime rate loans. Due to the higher interest rate of the loans, they are called subprime loans. Subprime car loans are available to people who may have challenged credit or low credit scores.
What is a Credit Score?
A credit score is a number from 300 - 900 that represents the individual’s credit and their creditworthiness. A credit score is primarily based from a credit report sourced from a credit bureau, such as Equifax or TransUnion. It’s designed to help lenders determine how likely you are to pay back your loan.
Don’t be discouraged if you don’t have the highest number! You can always start building a credit history and the score is a snapshot in time, always fluctuating. Your score could change completely in three months, depending on your financial activity.
What if I’m currently in or have been discharged from Bankruptcy?
If you’ve been discharged from a bankruptcy or consumer proposal, we can help!
The process of insolvency whether it be credit counselling, consumer proposal or bankruptcy are all generally the same:
● Meet with trustee
● Determine type of insolvency
● Creditors approve insolvency
● Pay off debts based on repayment agreement with debtors
● Get discharged
As long as you have been approved for a time of insolvency we are able to help get you driving in your next vehicle.
*Please note if you are currently making payments to your repayment plan, all your payments must have been made on time.
What If I had Car Repossessions?
Banks understand that there could have been an unforeseen financial problem and will work with together to find the best suitable loan for you. Re-establishing your credit is important in order to move forward from a repossession.
What if I have a specific type of vehicle in mind?
Here at Fraser Valley Auto Loans, we work to match you with a vehicle that suits your needs. We have a network of auto dealers of whom we work with, and can pair you with multiple different makes and models of vehicles.
What this means to you, is if you have a certain make, or model in mind, you can insure that Fraser Valley Auto Loans will work to find that vehicle.
Did you know a car loan can help you rebuild your credit?
At Fraser Valley Auto Loans, we can help you start rebuilding your credit with a subprime car loan. An automotive loan reports monthly to the credit bureau, which will help improve your credit state. The rule of thumb is that car loans established credit faster than a credit card can. How does this work? For example, if you had a $25,000 car loan, this will report to the credit bureau and show accumulated payments. A $500 or $1,000 limit credit card does not have the same value or re-payment. This shows future lenders that you can handle this level of credit. Also lenders like to see both installment and revolving credit reporting on the credit bureau.
Financial Institutions usually take four major factors into consideration:
- 1. Credit History
- 2. Vehicle Information
- 3. Application Information (such as monthly income, time at job etc)
- 4. Down Payment Amount