First Financial auto financing

Ways to Avoid Going Upside Down in an Auto Loan

Upside down car loan

“Upside down” is only fun for kids.

Adults know too well it’s all about owing more money on a large asset than it’s worth. More, they are responsible for that debt. Many homeowners were upside down in their home loans from 2008 to 2012.

Some don’t realize that a car buyer, particularly a new car buyer, can spend several months to two years upside down in their car loan. You may ask: what’s the big deal about owing more than the car’s worth if you’re going to keep the car for several years? Problems arise when the car gets stolen or crashed. More serious problems arise when buyers realize they bought too much car and can’t afford it anymore. Unexpected medical expenses, job changes, new babies and even floods and fires have a way of tightening budgets very quickly. Sell the car, and you end up paying the bank an additional $1,000 – $5,000 to fulfill loan requirements.

Car buyers who are smart with their finances take a long-term view. Just a few adjustments to the car-buying plan ensures you won’t go upside down on your car loan.

Buy Used and Make a Good Deal
It’s common knowledge that a brand new car loses 11% of its value the minute the car buyer drives it off the lot. After one year, this new car loses 20% of its value and by five years, many cars have lost half their value. These average numbers don’t reflect the wide variety of car depreciation rates. Depreciation rates are faster for unpopular cars, slow for the popular models. But who knows what will be popular in 5 years?

The bottom line is to let the original owner to pay the first few years’ depreciation costs (one of the highest costs of vehicle ownership). Buy a car that holds its value. Financial planning and organization website Bankrate.com lists the makes and models of autos that hold their value most tenaciously. For 2014, these are the Hyundai Accent, Mazda 3, Chevy Corvette, Toyota Avalon, Kia Soul and Chevy Camaro. Any of these tickle your fancy?

The other advantage of buying a used car with a low depreciation rate is that you’re less likely to have a hangover loan amount into a new loan when you buy a new car.

Put Down a 20% Down Payment
This move will take care of the annoying taxes and fees outright. Paying interest on these taxes bumps these abstract fees even higher. Since car buyers get nothing for these charges, it’s best to dismiss them ASAP. Also, putting down 20% jumps you ahead of depreciation so that you leave the lot with a vehicle worth as much as or more than your loan. Also, manufacturers’ cash-back rebates can go right to that 20% down.

Consider A Loan Term That Is No Longer Than How Long You Plan To Keep The Car.
Some people are in the habit of buying a new car every two years. Others have just as much pride driving a 20-year-old “beater.” While, typically, car loan terms extend to just 5 years, recently, six and even 10-year loans have come into the market. If it’s your nature to keep a car until it dies, a 10-year loan makes sense. If you’re family is changing either by adding or removing members (kids born; kids off to college), you may be trading up or down when those events occur.

Get the Best Interest Rate You Qualify For
Online, and other alternative banks can offer lower auto loan rates because they labor under a fraction of the marketing and operating costs that saddle the large, bricks and mortar banks. More, online banks typically don’t have shareholders demanding higher profits every year. While the difference in the loan rate may be one-half of one percent, these charges add up to thousands of dollars saved over five years.
ALWAYS Comparison Shop to Get the Lowest Price for the Model You Want
Aside from homes (and maybe shoes?), cars evoke more emotion than most other large purchases. Cars reflect our identities. They are accessories we live with from two to 20 years. If you’ve found the perfect pumpkin-spice-colored Kia Soul, rest assured there will be another one across town or in another month. Go into the car dealership with your emotions fully under control. This experience must be ruled by the mind, rather than the heart. Remembering that you’re not just saving another $2,000, but $2,000 plus six to nine percent yearly interest keeps you sober and PICKY.

First Financial Provides Auto Loans, Bad Credit, Good Credit and More!
First Financial has been in business long enough to recognize the subtleties in each borrower’s financial situation. We also know that more than 50% of Americans fall into the subprime category. Their credit ratings range from “fair” to “poor” to “bad.” Our lending partners accept auto loan applications and approve these borrowers every day. Apply for an auto loan here today! Follow us

The Feasibility of Auto Loans: 5 Facts that Reassure Spouses and Parents

skeptical woman

blank If you’ve just heard you can only qualify for a “bad credit” auto loan, know that you are far from alone. More than 50% of Americans today DO NOT fall into the “prime” or “excellent” credit category that wins the best interest rates. Many gasp upon hearing the word “bad” in the description of their only possible auto loan, but rest assured, the bad credit auto loan is simply another category of frequently approved loans.

In fact, in the first quarter of 2014, U.S. banks approved 44% more bad credit auto loans than they did in the same period the previous year. With the economy improving, banks are more willing to take on customers with less cash at hand. (First Financial’s bad credit auto loan has a 93% approval rate.)

With the negative power taken out of the term “bad credit auto loan,” the next step in getting a reliable, attractive car is convincing the spouse or parent who may be co-signing, helping with down payments or monthly payments. We’ve made sure to add all the statistics and links so you can back up your case.

Bad Credit Auto Loan Interest Rates Are Higher But Not Outrageous

. . . and definitely NOT unheard of

Financial talking heads on television or radio can sour your significant other or another important family member on the bad credit auto loans. Sure . . . . those in the prime or “excellent” credit category get the lowest auto loan rates, but paying 7% to 10% or more for an auto loan still keeps reliable, attractive cars affordable.

Further, during some periods of the past 50 years, even those with excellent credit were paying over 10%. Ask a parent or grandparent what they paid for an auto loan at various times. Show them that you have proof that interest rates peaked in 1981 at 16% and only dropped under 10% as recently as 1997.

Getting a Bad Credit Auto Loan Helps You Get to Better Credit

That you make payments on time monthly gets reported to the credit bureau, slowly raising your score over the next months and years. Once your credit inches up into the “fair” category and then even the “good” category, you can consider refinancing at a lower rate.  And all that time you had a reliable car.

More, having reliable transportation to a job is a sure way to get the money needed to be a better bill payer. Many jobs even insist you have your own car. Stress to loved ones that you consider the higher interest bad credit auto loan a temporary fix while you work your way out of a negative credit picture. Maybe landing in the bad credit category taught you some important lessons, mistakes you don’t want to repeat.

Find Out How Much You’re Approved for Fast with First Financial

Banks are now more willing to lend to those whose credit scores dropped below “prime” or excellent . . . 700 or higher at this writing.

Our fast and simple online auto loan application and mobile auto loan application can get you driving within days. Want to get tips on finding the  lowest cost online auto, mortgage, personal loans as well as the loan industry?

Getting Auto Loans in 2020 Just Got Easier . . .

car dealership lot

Recently, credit tracking giant broadcast some great news for those needing fair, poor and bad credit auto loans. It reveals that during the second-quarter of 2020 U.S. banks:

  • Approved 44% more bad credit auto loans than they did in the same period in 2019
  • Approved 22.4% more good, fair and poor credit auto loans than in in 2019

Banks are now more willing to lend to those whose credit scores dropped below “prime” or excellent . . . 700 or higher at this writing.

Before you start feeling thankful to the banks, however, keep in mind that this move is in their best interest as over 50% of all American consumers today fall into the “subprime” categories . . . namely good, fair, poor, and bad. To stay in business, the banks need to be more open-minded and “open the purse strings” more frequently. More, with unemployment still at historic highs, loan and car sales have been increasing but not at the rate a more robust recovery would create. Auto dealers and loan officers need customers! They need YOU, even if you have poor or bad credit.

 Tips for Getting Fair, Poor or Bad Credit Auto Loans

  • put at least 20% down, more if you can
  • consider a used car, even a one-year-old car. (Cars depreciate at least 20% in the first year alone. After that, depreciation slows.)
  • search the financial institutions that offer auto loans online. Internet banks have far lower marketing and overhead costs, and pass the savings on to the consumer. Their automated processes also help them keep fair, poor or bad credit auto loans interest rates affordable.

First Financial Has Fair, Poor and Bad Auto Loans that Make You Mobile!

While of course those in the prime or “excellent” credit category get the lowest auto loan rates, paying 7% to 10% or more for an auto loan still keeps reliable, attractive cars affordable. Ask a parent or grandparent what they paid for an auto loan at various times. Interest rates peaked in 1981 at 16% and only dropped under 10% as recently as 1997. Our fast and simple online auto loan application and mobile auto loan application can get you driving within days. Want to keep an eye on lots of low cost online auto, mortgage, personal loans as well as the loan industry?

 

 

5 Reasons to Take a No Credit Auto Loan with First Financial

5 Reasons to Take a No Credit Auto Loan with First Financial

Applying for a Loan Approved

Did you know First Financial can offer you no credit auto loan options? Learn all about them in this detailed article.

According to reports by the Federal Reserve Bank of New York, 107 million Americans have auto loan debts. This data shows more Americans have car loans than mortgages.

Borrowers able to get auto financing at reasonable rates access larger and amounts than before. This sounds appealing to individuals with a solid credit history, but what if you are just starting off in the world of credit and have no history at all? The good news is that even with poor credit you can still get car financing by opting for a No Credit Auto Loan with First Financial.

But how can this happen? Read on to find out.

5 Reasons to Take a No Credit Auto Loan with First Financial

First, you need to understand the meaning of a No Credit Auto Loan. As the name suggests, this is a car loan extended to an individual with either no credit history, poor credit or limited history. Therefore, you can get an auto loan even without having a credit history, or with a bad credit history.

Below are the reasons why you need to take a No Credit Auto Loan with First Financial.

1. Fast Approvals on All Subprime Cases

Can you get a car loan with bad credit? This is a question asked by many people and you might be surprised to find out that of nearly 50% of American borrowers have a tarnished or limited credit history.

In other words, their credit scores lie in the subprime category, which means they have limited options for accessing loans. This category of people will find First Financial their best option since they can place their application regardless of their situation, whether its bankruptcy, poor credit, or no credit.

If you want to make a major purchase like a car or a truck and your credit history is not appealing, then this is the best website to turn to. You will be able to access the loan in the convenience of your laptop at the lowest possible rates you can ever imagine. The process is easy and confidential and you are sure to get a quick email response to update you on the progress of your application

2. Able to Manage Your Loan in the Comfort of Your Laptop

First Financial is an online lender which means it is accessible 24/7 anytime, anywhere. Some of the conveniences you are certain to enjoy:

  • Deposit payments using your laptop or handset.
  • Read your statement anytime on your devices.
  • Update your account profile which includes changing your logins for better security.
  • Compare interest rates of different dealers in the site.

First Financial believes that obtaining a No Credit Auto Loan should be hassle-free because this is a long-term financial decision you are making. You should not be under duress by auto-dealers whose main concern is the interest they get for every client they bring on board.

Working on your car loan from home will give you the freedom to check on different prices and options available so that you are sure to make an informed decision.

3. Reasonable Qualifications for Auto Financing

The requirements of getting an auto loan without credit on this website are so easy you may think it’s too good to be true. While the requirements are stringent enough to avoid liability to the borrower, they are also “loose” to ensure that most of the applicants get approved. The following are the only qualifications for auto financing:

  • Applicant should be a U.S. or Canadian resident of legal age-18 years and above.
  • Gross monthly income of $1,500 if the credit score is less than 625.
  • If the applicant has filed for chapter 7 bankruptcy, he/she should have completed the “341 Meeting of Creditors.”
  • If the applicant has filed for chapter 13 bankruptcy, he should show an “Authorization to Incur Debts” from the trustee.
  • Commitment to buy a car from their various approved car dealer partners.

Even if you have been declared bankrupt, you have a reason to smile because First Financial will sort you out. Such financial hurdles will no longer deter you from obtaining a loan for your vehicle or truck.

4. Special Package for Military Personnel

Members of the armed forces both on active duty or retired and struggling with bad credit may wonder how they may qualify for a car loan. First Financial has tailored made auto financing programs that helps them to obtain auto loans in spite of their poor credit scores.

First Financial understand the difficulties encountered by these military men and women in their effort to maintain safety and that is why they have specialized programs dedicated to them. Military auto loans are different from normal civilian loans because they are often offered on lower interest rates, require lower down payments and come with special discounts.

The rate of approval is high mainly because of the stability of their income. Military workers should not put off buying a car because of the demand of their duties but should embrace this enticing opportunity

5. Having Access to a Wide Range of Dealers

As mentioned earlier, First Financial is an online provider of bad credit car loan that partners with hundreds of authorized and licensed car dealers. This site will allow you to shop for dealers while comparing prices and interest rates.

To crown it all, you will be able to get several preapprovals using only one application. So don’t allow yourself to be limited by the car dealers or the financial institutions in your area, browse through our website for an array of choices.

Get a No Credit Auto Loan with First Financial

It may seem daunting at first but it is not impossible. A few tips will help you navigate the murky waters of credit even with no credit history to back you up.

Engaging a co-signer with an excellent credit history in your auto loan will increase your chances of approval. Also, a reasonable down payment will show the potential buyer that you are serious about buying a car despite your bad credit history and may serve to reduce the total cost of your loan. Finally, shop around to explore the options available in the market and compare various interest rates and the payment plans that suit your budget.

Remember, First Financial will offer you the best financial support irrespective of your credit history. Apply for your No Credit Auto Loan today in less than three minutes.

 

How to Obtain No Credit Car Loans

How to Obtain No Credit Car Loans

Though good credit is valuable, is there a such thing as no credit car loans? Yes! Find out how to easily obtain an auto loan without credit experience.

How to Obtain No Credit Car Loans

Did you know that approximately 45 million Americans have no credit score at all?

If you’re part of this group, you might think that it’s impossible for you to get approved for a car loan. That’s not exactly true, though.

There are lots of loans out there designed for people with low credit scores, as well as those with no credit score.

Read on to learn more about no credit car loans and how you can increase your chances of getting approved for one.

No Credit Car Loan Minimum Qualifications

If you have a bad credit score or no credit score, you can still qualify for a car loan. You just have to make sure you meet some other basic qualifications, including the following:

  • Have a gross monthly income of at least $1,500
  • Provide proof that you are a legal U.S. or Canadian resident
  • Provide proof that you are at least 18 years of age or older

If you have filed for bankruptcy in the past, you may also need to complete some additional paperwork to show that you authorized to purchase a car.

Many car dealerships also work with specific lenders to provide financing to people who might not otherwise qualify for an auto loan.

When you begin looking to purchase a car, consider asking the lender which dealerships they work with or recommend purchasing a car from.

Increase Your Chances of Approval

If you meet these minimum qualifications, there’s a good chance your auto loan application will be approved.

There are some other steps you can take to increase your chances even more, though, including the following:

Check Your Credit History

You may think you have no credit history, but it’s a good idea to double check before you apply for an auto loan. You might find out that you do, actually have a credit score.

Checking your credit report also allows you to notice and correct any errors that might affect your credit in the future.

Set a Budget

Figure out how much money you are able to spend on a car before you apply for a loan, too.

Think, specifically, about what you can afford to spend each month on the car and insurance. Don’t forget about maintenance and gas, too.

Doing these calculations and putting together a budget first will help you figure out how much money you should ask for when you fill out your loan application.

Consider a Higher Down Payment

You’ll have an easier time getting approved for a car loan — even if you don’t have a credit score — if you’re able to put down a larger down payment.

This makes you a more credible lending candidate. It will also help to lower your monthly car payments, so it’s a good strategy for every car buyer to use.

Consider a Co-Signer

You can also increase your chances of getting approved if you find someone who can co-sign your loan.

A co-signer is someone with a high credit score who agrees to take over your loan payments if you default.

Having someone co-sign your loan can help to bring down the monthly payments and give you better terms and interest rates.

A co-signer is a great option to consider.

Just keep in mind that it’s a big responsibility, and it can be difficult to find someone who’s willing to co-sign your loan. You may have to ask a few different people before you get a “yes”.

Gather Appropriate Documents

Make sure you have all the necessary documentation ready to go when you apply for your auto loan, too.

The following are some documents that will help you make a good case for yourself and prove that you can pay back the loan:

  • A copy of your bank statement to verify your monthly income
  • Documentation of recurring bills like your cell phone or utility bills — this helps to show that you pay your other bills on time each month
  • Pay stubs or other documents that provide proof of employment

If you can provide these documents when you’re applying for a loan, you’ll have a much better chance of getting approved.

Work with an Online Lender

You can also increase your chances of having your auto loan application approved if you work with an online lender.

Online lenders are often more flexible than traditional lenders and are willing to work with a wider range of customers.

Keep in mind that online lenders also tend to have better loan terms and rates, so it’s worth working with them even if you do have a good credit score.

Tips for Building Your Credit Score

If you want to build up your credit score before you apply for a car loan, there are a few different steps you can take, including the following:

  • Make all of your loan payments on time
  • Pay your utility bills and other bills on time, too
  • Open a credit card account and pay your balance in full each month (it’s a common mistake to assume that you should carry a balance over from month to month)
  • Don’t apply for too many credit cards or loans at once (this has a negative effect on your credit score)

Once you have your auto loan application approved, you can also use that loan to build your credit score.

If you make the monthly payments on time, you’ll start building credit and will have an easier time getting approved for loans in the future. You might also be able to refinance your loan later to get better terms.

Apply for No Credit Car Loans Today

If you don’t have a credit score but need a car, you still have options (that don’t involve taking public transportation for the rest of your life).

There are lots of no credit car loans that you can apply for.

If you meet the minimum qualifications listed above and keep these other tips in mind, you’ll have a much easier time having your application approved.

Are you ready to apply for an auto loan? If so, we can help at First Financial.

Contact us today to learn more about our auto loan requirements or to fill out an application.

Know the 4 Most Common Auto Loan Mistakes Before you Go to the Dealer

cash and car for auto loan
Be aware of auto loan pitfalls and save! 

 

Want to hear something scary? “The big mistakes are made in the financing office,” explains Phil Reed, senior consumer advice editor at Edmunds.com, the auto research website. “Making the right decisions can save thousands over the life of the loan.”

A car is a big purchase with a lot of moving parts. Dealers makes their profits between the gaps in buyer’s knowledge and they may try to confuse by unleashing lots of terms like “negative equity” and “origination fees.” Use these recommendations from experts to save thousands over the life of your car loan.

Don’t let the dealer define your credit score or credit “worthiness.”

Walk into the showroom with your credit report snugly in your back pocket. Otherwise, you run the risk that the salesperson leaves your negotiation only to come back with bad news about your credit. And of course that score isn’t high enough to get you the best rates. Who knows if he or she was checking your scores or playing a quick game of hacky sack? Dealers know that most consumers do not check their credit before being lured in by deals. Don’t make yourself vulnerable to this unethical treatment.

We discuss how to find your credit score easily in our previous blog post on rebuilding your credit (LINK). Just go to Annualcreditreport.com, fill out a few fields and your report arrives in you inbox instantly. Trust these results from the only free site authorized by the U.S. government’s Federal Trade Commission. Typically, anyone with a credit score of 720 or higher gets the lowest interest rates as they’ve demonstrated the most responsible money management. Still high 600s to low 700s is considered a “good” score. Those with lower scores can still get loans, but they will pay more in interest and fees.

Another way to check your credit is to get pre-approved from an outside lender like your bank or by applying for an online auto loan.  If you can manage to shave just 1 percent from your car loan, you’ll pay hundreds less over the next five or six years.  

Don’t make the wrong choice between a loan interest rate and a cash rebate.

Sure, the cash rebate feels enticing. And it might be the right choice if you use it to pay off other, higher interest loans like cash advances or credit cards. Basically, you need to decide if you want a lump sum up front or lower monthly payments over the next five or six years. Of course, not every car buyer is offered low-interest car financing, only those with the best credit scores. Again, know your score before you go to the dealership.

Don’t roll negative equity forward.

Some like to get new cars every two years. Often, they walk into the dealership with their auto loan “upside down.” That means they still owe more on the car than it’s worth. While those loving shiny new cars can get their next ride even if their loan is upside down, they’re putting themselves on a downward financial spiral.

Dealers don’t care what financial shape the car buyer puts themselves in. They will just add the negative equity–what you owe–into the purchase price of the new car. Chances are, this frequent buyer will just roll even more negative equity into the next new car, too.

Rather than enter this vicious cycle, consider buying a used car. A car loses much of its value in the first two years off the lot. And today, most cars are built to last 250,000 miles. Consider keeping the car longer and buying used to get the most for your car budget.

Don’t finance costly add-ons.

Just as movie theaters make most of their money on the popcorn, 37% of auto dealer’s profits come through aftermarket add-ons. These add-ons include  extended warranties, fabric protection and paint sealant and they are always less expensive from vendors other than the dealer. These costs feel like a no brainer when amortized over the life of the loan. The salesperson is quick to tell you that they add just a few dollars to every payment. Still, even $20 more over 60 payments is an additional $1200–real money.  

Don’t hesitate to question all fees.

With the deal wrapping up, a buyer’s guard is down. Salespeople know this well. The deal takes so long for a reason. It’s at the end that a salesperson may bring up unusual fees that may have official sounding names. Review all of the legitimate fees here and don’t hesitate to push the salesperson to drop anything that sounds suspicious.

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A+ Rated First Financial Approves Auto Loans Up to $45,000

Better Business Bureau A+ rated First Financial has helped arrange over 1,000,000 auto loans, some with approved amounts of up to $45,000. We have loans for borrowers with all credit scores, even fair poor and bad credit. Take three minutes to apply here for a new or used car loan and get your answer fast!

 

First Financial

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