FAQ – Bad Credit Auto Loans
Frequently Asked Questions:
What types of loans are offered at Budds’ Auto Credit?
Good credit, bad credit, no credit, bankruptcy, consumer proposal (discharged or not) credit counselling. We have lenders for all types of credit, that’s what we specialize in!
Are your loans open?
Yes all of our loans are fully open meaning that you can pay them off or down at anytime without interest penalty. When you trade your vehicle in you are only responsible for the remaining principle amount owing on the loan.
Is a down payment required?
No down payment loans are readily available meaning you can get into a vehicle with no money down and no up front fees. Most of our lenders offer these types of loans however depending on your personal credit circumstances a down payment may be required on a guaranteed approval loan or if you want to finance more than what the lender is willing to approve.
How does a down payment affect my loan?
A down payment will lower your monthly payment and reduce the amount of interest you would pay without one.
Can I use my trade as a form of down payment?
Yes most certainly! We are always pleased to appraise your vehicle for you. No matter what shape your trade is in, it will represent a value that we can use against the loan.
Do your lenders report my credit loan payments to the credit bureau?
Yes! All of our lenders report to the credit bureau, this helps reestablish your credit!
What does it take to qualify for a car loan?
- You must be employed and on your job minimum three months or past probation (some exceptions, IE new job, same position, past job with several years tenure)
- Minimum income requirement $1800 monthly
- Valid drivers license
*** Some exceptions may apply if credit application is joint
What is a credit bureau/report?
A credit bureau is a report card of how you pay your bills. Any credit card company that you enter into a financial agreement with along with loans from your bank or other finance companies as well as cell phone companies all report your payment history to one of Canada’s two major credit reporting agencies; Equifax Canada and or Trans Union.
The report will include the creditor’s name, when the account was open, the credit limit, current balance, past due amount if any, late payments if any, date of last activity.
Other information that is reported are secured chattels, public records such as a bankruptcy or consumer proposals and legal financial judgements. Unpaid accounts or accounts closed by a credit grantor may be reported as a collection. All these factors will earn you a rating good or bad depending on your payment history.
How do I find out what my credit score/rating is?
Can I apply for new credit if I am currently in a consumer proposal or bankruptcy?
Yes, the sooner you start to rebuild your credit after filing the better off you will be. If you do not establish any new credit it will be very difficult for you to obtain a loan or credit card in the future. Remember that credit is history of how you pay your bills and history is built over time. No history, no credit to rate…It is important however not to apply for more credit than you actually need. A good benchmark would be to obtain three new pieces of credit. A credit card, an installment loan and a line of credit. Chances are you will not qualify at your bank if you are in a proposal or bankruptcy. A secured credit card and line of credit may be necessary. Home Trust Visa and Capitol One are two credit card companies that will likely consider your application.
What factors affect my credit score?
Your credit score is affected by many factors. The number of credit inquiries, the balances on your accounts, judgements, late payments, collections and public records. The length of time accounts have been opened will also play a factor.
Will a car loan help get my credit reestablished?
Yes. A car purchase is usually the second largest purchase we as consumers will take on other than our mortgages. A car loan will be a higher dollar amount financed than say what your credit limit might be on your credit card. It will represent a high credit amount that will prove your repayment ability on a high dollar amount. Good repayment on an installment loan such as a car loan will reflect positively on your credit report and show lenders that you are a good risk.