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AAACredit is the Company to Help You Achieve Excellent Credit

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Ohio, USA, Aug. 14, 2020 (GLOBE NEWSWIRE) — AAACredit is based in Columbus, Ohio and founded by Breanna Walker.  Breanna, single mom of twins, knew that she wanted more for her life and her children.  After years of struggling with bad credit and making ends meet,  she took various courses and mastered the Federal Laws that helped her fix her own credit report.  Doing so, eliminated some debt which also helped her organize her finances.  “I started out with 550 and increased my Credit Score to over 760s,  in the matter of months.  Without Good Credit, I wouldn’t have my car, house or be able to provide stability for my kids.  I was able to leverage my credit, to improve my life, family and help me get back on my feet.”  said Breanna. 

After telling her friends and family about how she fixed her credit,  they soon wanted her to fix their credit report as well.  She knew then, from freely wanting to help others, that this was her passion.  What started out, helping herself,  friends and family, soon grew to AAACredit, helping clients all over the United States fix their credit. 

Majority of Americans have credit issues that’s hindering their ability to obtain other credit.  Some of them are in a dilemma on how to fix it,  while others do not have enough knowledge about establishing and fixing their credit effectively and efficiently. Due to this lack of awareness, most of the customers end up facing more financial struggles and their credit score remaining low.

AAACredit is an all-in-one solution to provide answers to these credit concerns and also dispense solutions to overcome the credit challenges they are facing. At AAACredit, they have years of experience, dealing with every type of report and fixing poor credit scores via removing negative, inaccurate accounts from credit reports and assisting with rebuilding credit accounts. 

AAACredit is affordable, trustworthy and provides the client with excellent results, while unlocking deeper value in each customer engagement.  “At AAACredit,  our goal is to help you reach your credit goals and educate you to help you maintain long term goals.  We’re here every step of the way!” said Breanna. 

AAACredit restoration technique is different and their action plan is tailored based on the customer’s credit report.    The process is pretty efficient as well. Credit completion is based on the client’s report but initial results can be seen usually within just 1-2 months and an average of 6 months. Timeframe to complete is given during the Credit Analysis step but AAACredit’s target goal is to complete the client’s credit file in 6 months and less.   The company has had great success with removing bankruptcies, collections, charge-offs, repossessions, medical bills, utilities, credit card debt, inquiries, old addresses,  tax liens and student loans from credit reports. AAACredit is confident in removing negative information from the reports, which enables them to offer the clients with a flawless money back guarantee system. 

Commenting on the company’s foray into the market,  Breanna explained;  “I have many years of experience in evaluating credit and guiding consumers to assert their legal rights.  I love making an impact in my client’s life!  My goal is to help clients improve their overall credibility by removing derogatory marks and/or adding credit enhancements, such as Tradelines.  Fixing Credit is my PASSION!  I work tirelessly to ensure my clients meet their goals of purchasing a car, home, obtaining personal loans etc.  I’m driven by RESULTS and very persistent, I do not take NO for an answer because there’s always a solution! Majority of Americans have poor credit and I feel it’s my job to raise awareness that YOU can fix your credit! And I CAN help you!”

The company believes that it is their years of experience tied with their technique, process,  and passion for client results, that stand them in good stead to make AAACredit, one of the Best Credit Restoration Companies, in this sector in 2020 and years to come.

Media Contact Details:
Name: Breanna Walker
Company: AAACREDIT
Website: https://www.aaacreditcompany.com/
Email: info@aaacreditcompany.com

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How Does a ROBS Work?

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Ready to launch or grow your own small business but don’t want to take on debt? A rollover as business startup (ROBS) may be an option to consider, if you’re willing to risk some or all of your retirement savings.

ROBS enable entrepreneurs to fund a business using money held in eligible retirement accounts. ROBS  are complex and costly but can pay off if your business is a success. Before you decide if a ROBS is right for you, here’s an explanation of this startup funding option.

 

Editor’s note: Looking for the right loan for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.

 

 

How does a ROBS work?

With a ROBS, you roll over money from a 401(k) or traditional individual retirement account (IRA) into a new business or franchise without incurring early withdrawal penalties or taxes. If you’re under the age of 59 and a half, any 401(k) withdrawals normally incur a 10% penalty, but that doesn’t happen with a ROBS.

ROBS are not a loan. You don’t pay it back or pay interest. You do need to hire an attorney and/or a third party to set it up for you. “You have to follow very specific rules in order to do it properly,” Matthew Gillman, CEO of SMB Compass, told business.com.

To be eligible for a ROBS, you need to incorporate your business and open a new business 401(k). Once you’ve completed those two steps, you can transfer funds from your existing 401(k) or IRA to the business. [Need funding for your business but don’t think a ROBS is right for you? Read our review of the top business loans and alternative funding options.]

What are the requirements to set up a ROBS?

Unfortunately, with ROBS, there are a lot of guidelines to follow. Here are four significant rules you need to be aware of:

  1. You must have an eligible retirement account. To qualify for a ROBS, you need a qualified tax-deferred retirement account. If you have a 401(k), 403(b), IRA, Simplified IRA, Keogh or Thrift Savings plan, you’ll qualify. You can’t use money held in a Roth IRA or Roth 401(k). If you’re still gainfully employed, most companies won’t allow a current employee to roll over retirement savings to a ROB – you’ll need to use a retirement account not associated with your employer.
  1. You must have at least $50,000 in the fund. To use your 401(k) for a ROBS, you need at least $50,000 in retirement savings.
  1. You can’t be a passive investor in the business. The IRS requires you to be a contributing employee of the business you’re funding with your retirement savings. A ROBS is for an entrepreneur who will run the enterprise full-time – it’s not for someone looking for a passive investment.
  1. You must pay yourself a reasonable wage. Just because you’re the owner doesn’t mean you can overpay yourself. The IRS doesn’t say what jobs you must perform in the company, but you have to pay yourself a fair market salary. As a fiduciary of the plan, you must act in the best interest of the plan, and that includes what salary you take.

What are ROBS-prohibited transactions?

You could face tax consequences if you pay yourself an excessive salary, use business property for personal use, or use money from the ROBS to pay ROBS provider fees. If you act in the 401(k) plan’s best interest you should be in the clear.

How do you set up a ROBS?

There are several steps involved with setting up a ROBS plan, which is why most people use a third-party provider. Here’s what it entails:

  • Create a C corporation. To be eligible for a ROBS, your business must be structured as a C-corp. With a C-corp, the owners and shareholders are taxed separately from the business. If you’re operating an LLC or a sole proprietorship, you’ll have to convert the business to a C-corp.
  • Pick a retirement plan. Once you are an established C-corp, you have to choose a retirement plan for your business. Funds from your existing retirement account will be deposited into the new plan. Your new plan can be a 401(k), defined contributions or a profit-sharing plan.
  • Roll over funds into the ROBS. After the plan is set up, you can initiate a rollover from your retirement accounts. It can take two to four weeks for the rollover to be complete.
  • Buy stock in the company. With the new funds in your company 401(k), you then buy shares in your C-corp.
  • Use the proceeds for business operations. Whether you’re growing an existing business or launching a new one, at this point, proceeds from the ROBS can pay for the business’s expenses.

What are the pros and cons of ROBS?

As with any investment, ROBS have many pros and cons that need to be carefully weighed.

Pros of using a ROBS

  • You don’t have to take out a loan. Borrowing money to fund a business is expensive, whether it’s a short-term loan or you’re borrowing against your sales. Besides the monthly payments, there’s interest and other fees. That’s not the case with a ROBS plan. “If you feel confident in what you do, this is a way to access capital,” said Phil Mitchell, a certified public accountant and member of the AICPA Personal Financial Planning Committee. “If I got a loan, I would be responsible via a personal guarantee.”
  • You avoid early withdrawal penalties. Unless you’re over the age of 59 and a half, if you withdraw money from your 401(k) or IRA, you will pay a 10% tax penalty. (Some exceptions apply, such as if you’re using savings to pay for medical expenses.) With a ROBS, you avoid that. “There is no withdrawal penalty, you are simply rolling one 401(k) into another and buying stock later,” said David Nilssen, CEO of Guidant Financial.
  • There’s no underwriting involved. Bad credit may prevent you from getting a loan, but that isn’t a factor with a ROBS. Since you’re using money you saved for retirement, a credit check doesn’t occur.

Cons of using ROBS

  • You’re draining your retirement fund. Using your retirement savings to fund a startup business has significant trade-offs. If your business succeeds and profits surge, you may recoup the money and then some. If the reverse happens and you struggle, your retirement is at risk or, at the very least, is delayed. “It’s the opportunity cost,” said Mitchell. “It’s how well did the C-corp do versus how the stock market did.”
  • You miss out on compounding interest. One of the benefits of investing in stocks and bonds is compounding interest, which is interest that you earn on the investment plus interest earned from previous periods. The longer your money is invested, the greater the return. Your retirement savings won’t grow if it’s tied up in your business.
  • Many small businesses fail. According to the Small Business Administration, about two-thirds of businesses with employees last two years, and only about half pass their fifth anniversary. “One of the biggest risks with ROBS is the high level of businesses that fail,” said Bobby Glotfelty, senior licensed financial professional at Betterment for Business. “Not only can your business fail, but you’re risking your own retirement.” Glotfelty said ROBS should be viewed as a last-resort option.
  • You must structure your business as a C-corp. C-corps can be incredibly complex. You’ll likely need help establishing one and an accountant to handle your taxes.
  • The chance of being audited increases. Run afoul of any IRS rule related to ROBS and your plan may be disqualified. In turn, you’ll face penalties and taxes. “It’s definitely complicated. You open yourself to a higher risk of being audited,” said Gillman.
  • It’s not cheap. While you won’t pay early withdrawal penalties, you will pay an upfront fee, plus a recurring charge to the plan provider. “There’s only a handful of providers that help facilitate ROBS,” said Glotfelty. “It’s expensive, and there’s an ongoing cost associated with it.” For example, Guidant charges $4,995 for setup and $139 per month for plan administration.

Setting up a ROBS plan is not a solution for every entrepreneur. If you want to preserve your retirement savings, ROBS isn’t for you. If you’re confident your business will succeed and aren’t afraid to take the risk, ROBS are a way to avoid taking on debt. It’s incumbent on you to make a decision based on a realistic assessment of your prospects, now and in the future.

“The ROBS is for anyone who is buying or starting a small business, where they believe there is great upside potential and investing in it will yield greater results outside the stock market,” said Nilssen.

ROBS FAQs

What are the costs involved in ROBS?

The ROBS industry is dominated by a handful of players that charge a flat upfront fee and a recurring administration expense charged monthly. Guidant, a leader in the market, charges a one-time fee of $4,995 and a $139 monthly fee to administer their ROBS plan.

How do you unwind a ROBS transaction?

Whether you’re unwinding the ROBS because your business is a success or failure, there are several steps involved. It’s important to follow all of the steps, because, otherwise, you face steep penalties from the IRS.

First, you have to contact your ROBS provider to alert them of your intentions. To unwind the 401(k), you must adopt a board resolution to end the plan. All stockholders must be notified the plan is being terminated. You may have to file IRS Form 5310, depending on your business. Check with your accountant to see if it’s a requirement.

Once that’s done, to complete the transaction, file IRS Form 5500, which is due the last year of the plan after the distribution of the assets. The 401(k) is not terminated in the eyes of the IRS until you file this form.

How is a ROBS different from an ESOP?

ROBS enable business owners to access tax-advantaged retirement dollars to fund a business venture. Employee Stock Option Plans (ESOPs) are similar to profit-sharing plans. The company uses its stock or cash to buy existing shares. It’s often used to reward employees and to fund growth, and is designed to hold employer stock.

How many people can invest in a business using a ROBS?

If you are entering into the business with a partner or multiple partners who also plan to use a ROBS plan to fund the new venture, you’re not limited in terms of who can invest in the business with a ROBS. However, you and your partners must be a contributing employee to the business.

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Best student credit cards for November 2020

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College and high school look a lot different this year. But whether students are on campus or learning at home this fall, there are still plenty of back-to-school expenditures. And if a student doesn’t already have a flush checking account in place, many of those purchases will need to be put on a credit card. But it’s not always easy for a student to get one from a typical credit card company — especially if they don’t already have a steady income and good credit.

Credit is a Catch-22: It’s important to have good credit, but hard to get — unless you already have it. Student credit cards address that conundrum. They provide a way in for those with a limited credit history by providing a small credit line. The card issuer takes the risk with the hope that most students will transition into full-time employment and stick around as profitable customers for years to come.

Best student credit cards

Best overall Best for students without a credit history Best for students who plan to carry a balance Best for students with a cosigner
Discover it Student Chrome Deserve Edu Credit Card Chase Freedom Student Bank of America Travel Rewards
Annual percentage rate (standard / penalty) 17.99% variable, with 0% for the first 6 months / None 18.74% variable / None 14.99% variable / None 14.99% to 22.99% variable
Late payment fee Up to $40 Up to $25 Up to $39 Up to $40
Cash back reward rate 2% on gas and dining (up to $1,000 in combined purchases each quarter), 1% on all other purchases 1% on all purchases 1% on all purchases; 4% cash back on Lyft until 2022 1.5% on all purchases
Eligibility requirements No credit history required, proof of income required No credit score required; no social security number required for international students Cosigners not allowed, proof of income required Cosigners allowed
Annual fee $0 $0 $0 $0

Most credit cards require applicants to have a high credit score (around 650 or so) and at least a few years of credit report history. To get a student credit card, however, you don’t necessarily need either — though some proof of financial experience and responsibility helps when it comes to securing a credit card offer. The card issuer looks at sources of income — even from part-time work or deposits from parents — as well as information about checking and savings accounts to get a sense of an applicant’s saving and spending. Luckily, once a student is able to get a card, simply making everyday purchases is an easy way to build credit (so long as the student is able to pay off their purchases).

In addition to more relaxed eligibility requirements, the best student credit card offers some of the following features:

  • Special rules for credit newcomers such as minimal late fees and no-penalty APRs
  • Lower credit limits — usually between $500 and $2,000
  • Cashback rewards program on spending
  • A “reasonable” APR — usually between 15 and 20%

We evaluated 19 credit cards marketed specifically to students. We selected four cards that stood out across a range of criteria including APR, forgiveness for credit mistakes, cash rewards and lenient eligibility requirements. Check out our picks below as well as some answers to frequently asked questions about student credit cards at the end of this article. We’ll update this list periodically.

The best student credit card overall

  • Standard APR: 17.99% variable (0% for the first 6 months)
  • Penalty APR: None
  • Late payment fee: Up to $40
  • Annual fee: $0
  • Cashback rewards: 2% on gas and dining, up to $1,000 in combined purchases each quarter; 1% on all other purchases 
  • Foreign transaction fee: 0%
  • Standout feature: No late fee for first late payment
  • Eligibility requirements: No credit history required, proof of income 

The Discover it Student Chrome offers a winning combination of cash back and other rewards as well as lenient terms for first-time credit card holders. You won’t get dinged by the credit card company for a late payment — at least the first one — or have to deal with an exorbitant penalty APR. And, of course, getting 1 to 2% back in rewards each month is a welcome bonus. Note that Discover offers another similar student credit card, the Discover it Student Cash Back credit card, but the rotating bonus categories make things overcomplicated, especially for first-time cardholders. 

Features and rewards

Most student credit cards offer 1% cash back. The Discover it Student Chrome card bests that with 2% cash back on gas and dining, plus a generous cashback match at the end of the first year. The match effectively doubles your first year’s bonus rewards, so if you receive $75 in cashback rewards during the first 12 months, Discover will chip in an additional $75. We also like that the Chrome student credit card incentivizes good grades: You can earn a $20 statement credit for each school year you maintain a GPA of 3.0 or higher. 

Rates and fees 

Discover’s rates and fees are generally lower than competitors’. The APR charged on purchases ranges between 12.99 and 21.99%, and there’s an introductory six-month period with 0% APR. Students with the Discover it Student Chrome also don’t have to worry about a penalty APR, which some issuers will institute if a card holder misses a payment. There’s no late fee for the first late payment, but for the second instance the credit card company charges up to $40, which is comparable to other cards. 

At the moment, most study abroad programs have been put on hold. That noted, the Chrome student credit card has no foreign transaction fees — though Discover isn’t as widely accepted outside of the US as Mastercard and Visa.

Best for students without a credit history

  • Standard APR: 18.74% variable
  • Penalty APR: None
  • Late payment fee: Up to $25
  • Annual fee: $0
  • Cashback rewards: 1% on all purchases 
  • Foreign transaction fee: 0%
  • Standout feature: Low late payment fee
  • Eligibility requirements: No credit score required; no social security number required for international students 

Deserve Edu Mastercard positions itself as an alternative to the traditional banks and credit card issuers, and specializes in credit cards for students and first-timers. And the Deserve Edu student credit card checks many of the boxes: It offers 1% back on all spending, features a relatively low late payment fee and comes with a flat 18.74% APR. While it offers a lower student rewards rate than others, its relaxed eligibility requirements are well suited for students with a brief or nonexistent credit history or other potentially disqualifying limitation — like not having a social security number, if you’re an international student. 

Features and rewards

The Deserve Edu student credit card offers 1% cash back on all purchases, which can be redeemed for statement credits in increments of $25. Card holders also get one year free of Amazon Prime Student — worth around $40 — and up to $600 of credit toward cell phone protection coverage when you pay your monthly bill with it. 

Rates and fees

The 18.74% variable APR is relatively low for a student credit card, and it’s not tied to your credit score, so you know exactly what the APR is at the outset. Rather, the APR is “variable” because it’s tied to the “prime rate” — a benchmark interest rate used by lenders that changes over time. With most other cards, you won’t know the exact APR certain until you’ve been approved — and if you have a limited or nonexistent credit history it could be on the higher end of the range of what the issuer advertises. If you miss a payment, there’s no penalty APR — though you may be charged a late payment fee of $25. (Still, that’s about $15 less than the fee charged by most other student cards.) Deserve doesn’t charge any foreign transaction fees.

Best for students who plan to carry a balance

  • Standard APR: 14.99% variable
  • Penalty APR: None
  • Annual fee: $0
  • Late payment fee: Up to $39
  • Cashback rewards: 1% on all purchases; 4% cash back on Lyft until 2022
  • Foreign transaction fee: 3%
  • Standout features: Free, unlimited access to credit score; Earn a credit limit increase after making 5 monthly payments on time
  • Eligibility requirements: No cosigners, proof of income

The student version of one of our favorite cashback credit cards, the Chase Freedom Student credit card has a lot to offer. The 14.99% variable APR is one of the lowest available for student credit cards, and you get a $50 credit when you sign up, a $20 bonus every year and a credit limit increase after five on-time payments.

Features and rewards

Chase offers cardholders free and unlimited access to their credit score, which can be an important tool for those building credit from scratch. The credit limit increase is another nice feature as credit utilization is a primary factor in a credit score. Most credit experts recommend using less than 30% of your total credit available, so the higher the limit, the easier it is to keep your utilization low.

Its 1% cash back on all purchases is consistent with the category average and the 4% back on Lyft rides is nice (though less practical for many in the coronavirus era). The $50 sign-on bonus can be triggered by making a single purchase in the first three months so you need not worry about hitting a high spending threshold. And the $20 annual reward can be redeemed for five years — as long as your account remains in good standing. 

Rates and fees

Every cardholder gets the 14.99% variable APR — so you know what you’re signed up for at the outset. It’s best not to maintain a balance month-to-month, but if it happens once or twice, the interest will be lower than with other cards.

A few words of caution: This card’s late payment fee can run as high as $39 for a first late payment; most other student cards have a lower penalty or no penalty for first-time offenders; and if you’re planning on studying abroad, this card will subject you to a 3% foreign transaction fee. 

Best for students who have a cosigner

  • Standard APR: 14.99% to 22.99% variable
  • Penalty APR: Up to 29.99%
  • Late payment fee: Up to $40
  • Annual fee: $0
  • Cash back rewards: 1.5% on all purchases
  • Foreign transaction fee: 0%
  • Eligibility requirements: Allows cosigners

Bank of America is one of the few card issuers that allows cosigners, who can be a parent, guardian — or anyone with a good credit score who’s willing to share the legal liability. On the other hand, any late or missed payments or high outstanding balances will also negatively affect the cosigner’s score. 

Features and rewards

This student credit card is essentially the same as Bank of America’s Travel Rewards card, which means it offers higher risks and rewards than most other student cards. You get a higher cash rewards rate — 1.5% back on all purchases — but fewer of the relaxed requirements for credit novices. And points can be redeemed only as statement credits against travel purchases; so, unless 1.5% of your spending is on taxis, Uber or Lyft, flights, baggage fees, hotels, rental cars, buses, trains, amusement parks or campgrounds, this card’s rewards aren’t particularly valuable.

Bank of America will grant you 25,000 points — equivalent to $250 — when you sign up if you spend $1,000 during the first three months. That’s a higher threshold than you’ll find with other student cards, but also a higher reward. Bottom line: If you can time your credit card application with a large purchase, it’s worth it.

Rates and fees 

Bank of America offers an introductory 0% APR for the first year and no foreign transaction fees. That being said, this student credit card doesn’t mess around when it comes to penalties: The standard APR runs between 14.99% and 22.99% depending on your credit score — but if you’re late with a payment, you could be hit with the 29.99% penalty APR. That’s exorbitant — and it comes in addition to a $40 late payment fee. Students at risk of paying late should avoid this card at all costs.

How does a student credit card work?

Student credit cards offer those with limited or no credit a way to start building credit and create a credit history. They generally come with lower credit limits than typical credit cards and don’t charge annual fees. And they often have novice-friendly features, including late payment forgiveness, incremental credit limit increases over time and credit education resources. Reward rates may be lower than standard cashback and travel credit cards, however, making student credit cards a lower risk, lower reward financial tool.

Are secured credit cards a good option for first-time credit card holders?

Secured credit cards offer a way to build good credit or repair bad credit — but they’re better suited for those who have bad credit or a nonexistent credit history. Secured credit cards also require an upfront security deposit in the amount of your credit limit; for $1,000 of credit, you have to give the bank $1,000. In effect, the bank is loaning your own money back to you — sometimes with an annual fee or high interest rate. If you don’t have another option, a secured credit card may make sense. But a secured card shouldn’t be the first choice for a credit newbie.

What do you need to qualify for a student credit card?

Most credit cards require an applicant to have a credit score of at least 650 and a substantial credit history. Student cards don’t. Still, you may need to demonstrate some financial responsibility — including a source of income, even from part-time work or deposits from your parents. The card issuer may also want to see information about your checking and savings accounts to get a sense of your spending habits and confirm that you’ll have sufficient funds to pay the minimum monthly payment. 

How do cashback rewards work?

For all the cards listed above, “cash back” refers to a statement credit that’s applied to your account to lower your balance. For the Bank of America Travel Rewards card, for example, you can only redeem rewards against travel purchases. But for most other cards, cash rewards can be applied toward a balance regardless of expense type.

Read moreThe best cashback credit cards

Cards we researched

  • CapitalOne Journey Student Rewards
  • Discover it Student Chrome 
  • Discover it Student Cash Back 
  • Deserve EDU Student
  • Bank of America Cash Rewards for Students
  • CapitalOne Secured Mastercard
  • Bank of America Travel Rewards for Students 
  • Citi Rewards + Student
  • OpenSky Secured Visa
  • BankAmericard for Students 
  • StateFarm Student Visa 
  • Wells Fargo Cash Back College 
  • Petal Visa 
  • Chase Freedom Student
  • CapitalOne Platinum
  • Discover it Secured
  • Chase Freedom Unlimited
  • Citi Double Cash Card
  • CapitalOne Quicksilver Cash

Disclaimer: The information included in this article, including program features, program fees and credits available through credit cards to apply to such programs, may change from time-to-time and are presented without warranty. When evaluating offers, please check the credit card provider’s website and review its terms and conditions for the most current offers and information. Opinions expressed here are author’s alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.

The comments on this article are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved, or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.

Read more: Best balance transfer credit cards of 2020

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Beware of Spot Deliveries! | Auto Credit Express

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A spot delivery is often considered a scam technique that some dealers use to get you to take delivery of a car immediately after you agree to a deal. However, just because you agreed to a deal verbally and put some cash down doesn’t mean that things can’t change or that the vehicle is yours to keep.

Spotting Spot Delivery Scams

Beware of Spot Deliveries!Spot deliveries, also called yo-yo financing, simply means that you drive off with the car before the financing process is done. This is problematic because you can sometimes drive home with a vehicle, only to get a call later that your auto loan application was rejected.

Once you get that call that your financing didn’t go through, one of two things tend to happen next:

  1. You have to draw up a new contract with the lender, typically with different terms than you originally agreed to.
  2. If you don’t want the new terms or can’t afford the payments, you’re forced to return the car.

This can be an emotional rollercoaster, and it’s extremely inconvenient. You get to drive off with your next vehicle, elated that you were tentatively approved, only to find out that you must return to the dealership to start the process over again.

Often, bad credit borrowers can be victims of a spot delivery scam. Once they hear they can take the car home, it feels like a done deal and that everything is sorted. When you’re struggling to get an auto loan approval, some borrowers take what they can get if they need a vehicle quickly.

This is the yo-yo part – going back and forth between an approval and a denial, and from home back to the dealer until something can be finalized.

Avoiding a spot delivery scam is simple: just don’t drive off with the car until all of the necessary paperwork is completed and finalized. This means verifying that you’ve signed the title, the financing documents, and the sales contract. Don’t put any money down on a vehicle until your financing is approved, and don’t drive away from the dealership with any documents left unsigned.

Additionally, bad credit borrowers can explore other financing options if they’re struggling to get an auto loan approval.

Trouble Getting an Auto Loan?

If you’ve had issues finding a lender that can work with your credit, consider special financing. Special financing dealers are signed up with subprime auto lenders that are equipped to handle all sorts of unique credit situations like a past repo, bankruptcy, or poor credit. Instead of basing their loan decision on credit score alone, they examine the many parts of your financial health to determine your ability to take on a car loan.

After you submit your items to a special finance dealership, they’re sent off to one or more subprime lenders that see if you’re ready for an auto loan. Based on your income and overall stability, subprime lenders tailor a car loan (if you qualify) to your situation.

This means approving you for a monthly payment that fits your budget, also called a payment call. Subprime lenders see if you qualify before you pick a vehicle – not afterward. The financing process is done before you take a car home, unlike a spot delivery.

Subprime lenders also report their auto loans to the credit reporting agencies, giving you the chance for credit repair. With an improved credit score, you can have more options for new credit, and hopefully qualify for a better interest rate and possibly a higher loan amount on future car deals. Getting out of bad credit should be a priority, since it can determine so much of your vehicle buying power.

Finding the Right Car Loan

Instead of hoping to run into a dealer that has bad credit lending resources, start with us at Auto Credit Express. We know where special financing dealerships are, and we match bad credit borrowers to them daily.

To get connected to a dealer in your area, fill out our auto loan request form. It’s completely free, secure, and carries no obligation. Get started now!

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