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Can I Get an Auto Loan After a Repossession?



A repossession can impact your ability to get another car loan, but it isn’t impossible – if you know which lenders to talk to and give yourself, and your credit, some time to heal.

After a Vehicle Repossession

Can I Get a Car Loan After a Repossession?Once your car is repossessed, it’s typically sold at auction to cover the remaining balance on your auto loan. You’re responsible for any remaining balance plus any fees that your lender incurred during the repo process – recovery, towing, storage, etc.

But what if you’ve taken care of all that, and you need another vehicle right away? The good news is that you still have some options, but your credit score now reflects a repossession. Here’s what to do next.

Prepare for a Car Loan After Repossession

If your vehicle was recently repossessed, or it was less than a year ago, most traditional lenders are likely to turn you down for another car loan. Traditional lenders usually include credit unions, banks, and the captive lenders of automakers. Subprime lenders may also be hesitant to approve a borrower with a recent repossession.

However, if your repo is over a year old, your chances of approval increase. Over time, the negative effect on your credit score lessens – but it still may not be the best.

To help prepare for your next car loan, focus on repairing your credit. This means:

  • Paying off any outstanding collections that are harming your credit.
  • Keeping up on other debts and bills by making timely payments.
  • Removing incorrect information from your credit reports.
  • Reducing your credit card debt.
  • Keeping unused or old credit accounts open (closing them can lower your credit score).

Payment history is the largest factor in determining your credit score. If you don’t have the funds to lower any other debts currently, focus on making on-time payments on all your accounts at the very least. Just like a repossession, missed or late payments can remain on your credit reports for up to seven years.

Make a point to review your credit reports from the three major credit reporting bureaus: TransUnion, Experian, and Equifax. You’re allowed to request a report from each of them for free once every 12 months at Take a look at your reports and see what lenders see when you apply for your next auto loan. This way, you can be an informed car buyer and know where you need to improve and what you’re likely to qualify for. And, reviewing your own credit reports won’t harm your score!

Additionally, take the opportunity to correct any misinformation that may be listed including old or inaccurate information, duplicate accounts, or paid negative accounts. This is called credit repair, and there are credit repair companies that can help with disputing this incorrect information, which can help improve your credit score.

After all of this hard work, if you’re still getting turned down by auto lenders, there are a few options left to explore.

Buy Here Pay Here Dealerships

There are dealers that don’t usually pull your credit reports during the car loan approval process, called buy here pay here dealerships (BHPH). These dealers have in-house financing, simply meaning that the dealership you work with is also your lender.

The biggest plus with these dealers, especially after a repo, is that your low credit score typically doesn’t matter. Even if your repossession is less than a year old, the dealership usually won’t review your credit reports. This could mean getting approved for an auto loan rather quickly, even after a recent repossession, when most traditional lenders may turn you down.

BHPH dealers are more concerned about your ability to make loan payments than your credit score. They do require a down payment, which could be 20% or more of a vehicle’s selling price. If you end up at a BHPH lot, be prepared to bring a down payment to get a car.

However, while BHPH dealerships don’t typically use your credit score in the approval process, they do report missed and late payments and repossessions. They also don’t typically report good paying behavior. What this means for you is that even with timely payments on an auto loan, your credit score won’t improve – but any missed or late payments lower your credit score. Be sure to ask the dealer if they report car loans to the credit bureaus if you want your credit score to recover from a recent repossession.

Another route to investigate is subprime lending. While some subprime lenders may not approve you for an auto loan with a recent repossession on your credit reports, it’s still worth looking into.

Subprime Lenders

Subprime lenders work through a dealership’s special finance department to help borrowers with less than perfect credit scores get approved for auto loans. They review your credit reports, but they also take into account your income, job and residence stability, and bill and loan payment history.

These bad credit lenders report car loans to the credit bureaus, and if you keep up on the monthly payments, this can help rebuild your credit score after a repossession.

We want to help with that.

At Auto Credit Express, we match borrowers with unique credit situations to dealers that work with subprime lenders. Once you complete our free auto loan request form, we get to work finding a dealership that can work within your situation. There’s never an obligation to buy, so let us help you take the hassle out of finding a dealer that can work with you.

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Are Sallie Mae Student Loans Federal or Private?



When you hear the name Sallie Mae, you probably think of student loans. There’s a good reason for that; Sallie Mae has a long history, during which time it has provided both federal and private student loans.

However, as of 2014, all of Sallie Mae’s student loans are private, and its federal loans have been sold to another servicer. Here’s what to know if you have a Sallie Mae loan or are considering taking one out.

What is Sallie Mae?

Sallie Mae is a company that currently offers private student loans. But it has taken a few forms over the years.

In 1972, Congress first created the Student Loan Marketing Association (SLMA) as a private, for-profit corporation. Congress gave SLMA, commonly called “Sallie Mae,” the status of a government-sponsored enterprise (GSE) to support the company in its mission to provide stability and liquidity to the student loan market as a warehouse for student loans.

However, in 2004, the structure and purpose of the company began to change. SLMA dissolved in late December of that year, and the SLM Corporation, or “Sallie Mae,” was formed in its place as a fully private-sector company without GSE status.

In 2014, the company underwent another big adjustment when Sallie Mae split to form Navient and Sallie Mae. Navient is a federal student loan servicer that manages existing student loan accounts. Meanwhile, Sallie Mae continues to offer private student loans and other financial products to consumers. If you took out a student loan with Sallie Mae prior to 2014, there’s a chance that it was a federal student loan under the now-defunct Federal Family Education Loan Program (FFELP).

At present, Sallie Mae owns 1.4 percent of student loans in the United States. In addition to private student loans, the bank also offers credit cards, personal loans and savings accounts to its customers, many of whom are college students.

What is the difference between private and federal student loans?

When you’re seeking financing to pay for college, you’ll have a big choice to make: federal versus private student loans. Both types of loans offer some benefits and drawbacks.

Federal student loans are educational loans that come from the U.S. government. Under the William D. Ford Federal Direct Loan Program, there are four types of federal student loans available to qualified borrowers.

With federal student loans, you typically do not need a co-signer or even a credit check. The loans also come with numerous benefits, such as the ability to adjust your repayment plan based on your income. You may also be able to pause payments with a forbearance or deferment and perhaps even qualify for some level of student loan forgiveness.

On the negative side, most federal student loans feature borrowing limits, so you might need to find supplemental funding or scholarships if your educational costs exceed federal loan maximums.

Private student loans are educational loans you can access from private lenders, such as banks, credit unions and online lenders. On the plus side, private student loans often feature higher loan amounts than you can access through federal funding. And if you or your co-signer has excellent credit, you may be able to secure a competitive interest rate as well.

As for drawbacks, private student loans don’t offer the valuable benefits that federal student borrowers can enjoy. You may also face higher interest rates or have a harder time qualifying for financing if you have bad credit.

Are Sallie Mae loans better than federal student loans?

In general, federal loans are the best first choice for student borrowers. Federal student loans offer numerous benefits that private loans do not. You’ll generally want to complete the Free Application for Federal Student Aid (FAFSA) and review federal funding options before applying for any type of private student loan — Sallie Mae loans included.

However, private student loans, like those offered by Sallie Mae, do have their place. In some cases, federal student aid, grants, scholarships, work-study programs and savings might not be enough to cover educational expenses. In these situations, private student loans may provide you with another way to pay for college.

If you do need to take out private student loans, Sallie Mae is a lender worth considering. It offers loans for a variety of needs, including undergrad, MBA school, medical school, dental school and law school. Its loans also feature 100 percent coverage, so you can find funding for all of your certified school expenses.

With that said, it’s always best to compare a few lenders before committing. All lenders evaluate income and credit score differently, so it’s possible that another lender could give you lower interest rates or more favorable terms.

The bottom line

Sallie Mae may be a good choice if you’re in the market for private student loans and other financial products. Just be sure to do your research upfront, as you should before you take out any form of financing. Comparing multiple offers always gives you the best chance of saving money.

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Tips to do some fall cleaning on your finances



Wealth manager, Harry Abrahamsen, has five simple ways to stay on top of the big financial picture.

PORTLAND, Maine — Keeping track of our financial stability is something we can all do, whether we have IRAs or 401ks or just a checking account. Harry J. Abrahamsen is the Founder of Abrahamsen Financial Group. He works with clients to create and grow their own wealth. Abrahamsen shares five financial tips, starting with knowing what you have. 

1. Analyze Your Finances Quarterly or Biannually

You want to make sure that your long-term strategy is congruent with your short-term strategy. If the short-term is not working out, you may need to adjust what you are doing to make sure your outcome produces the desired results you are looking to accomplish. It is just like setting sail on a voyage across the Atlantic Ocean. You know where you want to go and plot your course, but there are many factors that need to be considered to actually get you across and across safely. Your finances behave the exact same way. Check your current situation and make sure you are taking into consideration all of the various wealth-eroding factors that can take you completely off course.

With interest rates very low, now might be a good time to consider refinancing student loans or mortgages, or consolidating credit card debt. However, do so only if you need to or if you can create a positive cash flow. To ensure that you are saving the most by doing so, you must look at current payments, excluding taxes and insurance costs. This way you can do an apples-to-apples comparison.

The most important things to look for when reviewing your credit report is accuracy. Make sure the reporting agencies are reporting things actuary. If it doesn’t appear to be reporting correct and accurate information, you should consult with a reputable credit repair company to help you fix the incorrect information.

4. Savings and Retirement Accounts

The most important thing to consider when reviewing your savings and retirement accounts is to make sure the strategies match your short-term and long-term investment objectives. All too often people end up making decisions one at a time, at different times in their lives, with different people, under different circumstances. Having a sound strategy in place will allow you to view your finances with a macro-economic lens vs a micro-economic view. Stay the course and adjust accordingly from a risk and tax standpoint.

RELATED: Financial lessons learned through the pandemic

A great tip for lowering utility bills or car insurance premiums: Simply ask! There may be things you are not aware of that could save you hundreds of dollars every month. You just need to call all of the companies that you do business with to find out about cost-cutting strategies. 

RELATED: Overcome your fear of finances

To learn more about Abrahamsen Financial, click here

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How to Get a Loan Even with Bad Credit



Sana pwedeng mabura ang bad credit history as quickly and easily as paying off your utility bills, ‘no? Unfortunately, it takes time. And bago mo pa maayos ang bad credit mo, more often than not, kailangan mo na namang mag-avail ng panibagong loan. 

Good thing you can still get a loan even with bad credit, kahit na medyo limited ang options. How do you get a loan if you have bad credit? Alamin sa short guide na ito. 

For more finance tips, visit Moneymax.



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