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Using a Credit Card for a Down Payment on a Car

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Dealers may accept your credit card, but that doesn’t always mean it’s a good idea to use it to cover a down payment on a car.

Cars Loans and Credit Cards

Using a Credit Card for a Down Payment on a CarIf you’ve been considering using a credit card to cover a down payment on a vehicle, it isn’t generally recommended.

First, let’s consider the auto loan that you’re looking to get into. Car loans are installment loans, and they’re almost always simple interest loans, which means you’re charged interest daily on the balance of the loan.

This is why putting down a large down payment on a vehicle is a great idea for anyone, since when you finance less, there’s less principle that interest can be charged on. However, using borrowed money (a credit card) to make a down payment to finance the car (more credit) may not be the best idea. In fact, it may not even be possible!

Down Payments and Credit Cards

You can put cash down to lower your monthly vehicle payment, decrease the amount you’re financing, shorten the loan term, and save on interest charges. By using a credit card to make your down payment, you’re decreasing the amount you’re financing from the auto lender but not the total amount you’re borrowing.

It’s simply because you put the down payment amount on your credit card, and you must pay interest on it until it’s paid off. If you were intending to use a down payment to lower your car payment each month, you’re also paying for the vehicle on your credit card now. This doesn’t exactly free up any disposable income each month, since you’re now making payments on the credit card along with the car payment.

Think of it as shifting the auto loan to another place – it still exists and you still owe that amount. Depending on the interest rate you’re charged on your credit card, you could even be paying more for the car.

Meeting a Down Payment Requirement With Cash

As a rule, credit card interest rates tend to be higher, on average, than traditional auto loans. If this is true for you, then you’re going to be paying more for the vehicle in the form of interest charges on your credit card.

Using a credit card for a down payment speaks to the mentality of “I’ll worry about it later, I need the car now,” and convenience is a strong argument. However, you need to keep in mind that many lenders and dealerships may not even allow you to use a credit card for a down payment. The more a lender or dealer sees that you’re relying on additional credit, the more you may be lowering your chances of an approval.

To save the most cash, stress, and hassle, it’s in your best interest to simply save up the cash for a down payment. Not only does this save you money in interest charges, but cash is king, and it’s always going to be accepted anywhere.

If you’re working with a bad credit auto lender (a subprime lender), you’re likely to be asked to have a down payment of at least $1,000 or 10% of the vehicle’s selling price.

Again, down payments can be hard to save for. Luckily, you can use trade-in equity to help cover all, or part of, the down payment amount, since it doesn’t have to be all cash.

Bad Credit Auto Loans

While this may not be the answer that everyone wants to hear, saving up the cash for a down payment is one of the best things you can do to start your auto loan off on the right foot. With a large down payment, you’re lowering the amount you’re financing which saves you money down the line, while also lowering your monthly car payment.

Rushing into an auto loan with a credit card instead of a trade-in or cash probably won’t save you any money over the course of your car loan. Vehicles are big purchases, so take your time, look for the right lender, work on your credit, and save up a little each month for a down payment that benefits you in the future.

While meeting a down payment may be one of the most difficult things to do, another hurdle to overcome is finding a lender that can work with you if you have bad credit. Many traditional auto lenders turn away borrowers with less than perfect credit scores – enter subprime lenders! These lenders work through a dealership’s special finance department, and they work with all types of borrowers.

Here at Auto Credit Express, we have connections with dealers across the country that work with bad credit lenders. To get matched to a dealership in your area, fill out our free car loan request form.

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Pima Supes address eviction protections

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TUCSON, Ariz. (KGUN) — Economic fallout from COVID has cranked up concerns about evictions as tenants have trouble paying. There are Federal protections to reduce evictions in the pandemic but Pima County Supervisors are concerned about evictions that could bypass those safeguards.

Federal restrictions from the Centers for Disease Control restrict evictions if they could increase health risks in general— or the risk of spreading COVID because someone is put out of a home. Those protections are based on whether someone has trouble paying the rent.

Landlords and their lawyers spoke at this week’s Supervisors meeting. They say compared to keeping a tenant, an eviction is a loss for everyone. They want county rental assistance programs to move much faster to channel Federal grants to help tenants pay rent and help landlords cover their expenses.

Steve Huffman of the Tucson Association of Realtors reminded Supervisors tenants will still have to pay back rent and if they can’t it could hurt them long term.

“Many of them have huge judgments that will be issued against them eventually they will owe back rent for the time that they have not been paying rent, those judgments will create bad credit, and will interfere with future housing opportunities, and also future job opportunities.”

Tenants who create other problems beside non-payment or rent can still be taken to court and evicted.

But Pima Supervisors are concerned about reports of people evicted over questionable claims like a car parked in the wrong space or a toilet clogged too many times.

Chairperson Sharon Bronson says these eviction issues are focused by COVID but call for a broader look at how people become homeless.

“We are addressing basically the pandemic issues right now, but this may be, you know, an opportunity to just began the discussion about the larger discussion about homelessness and addiction down the road.”

Supervisors agreed to ask an existing task force on evictions during COVID to take a fresh look at eviction issues, especially in light of possible policy changes under the Biden Administration.



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Loans Bad Credit Online – PNC Personal loan 2021 Review | Fintech Zoom

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Loans Bad Credit Online – PNC Personal loan 2021 Review

Top perks

Low minimum loan amount

Customers can borrow $1,000 to $20,000. That minimum loan amount of $1,000 is unusual in the personal loan industry. A low minimum threshold means you can get the cash you need to cover small emergencies without being tied down to a larger loan.

Wide range of repayment terms

You have between 6 and 60 months to repay the loan. There are pros and cons to longer repayment terms, so this flexibility allows you to customize your term to your situation.. With PNC, you have the option of designing a repayment plan that fits your monthly budget.

Joint applicants welcome

Whether you need a joint applicant’s high credit score to qualify for a lower loan interest rate or someone has decided to co-assume responsibility for a personal loan, PNC allows for joint applicants.

What could be improved

Terms depend on location

The first thing you will be asked is where you live. On its loan homepage, PNC states that “PNC product and feature availability varies by location.” While this may be good news for borrowers in some areas of the country, it could be bad for others. You’ll need to see what it means for you.

Lowest interest rate reserved

If you’re looking to borrow enough to make repairs to your roof or buy a new furnace, you might not borrow enough to qualify for PNC’s lowest advertised interest rate. That’s because that low interest rate is reserved for those borrowing more money. For example, PNC will automatically assign a $5,000 loan a higher interest rate than a $15,000 loan.

Loans Bad Credit Online – PNC Personal loan 2021 Review

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Bad Credit

Loans Bad Credit Online – Loans Bad Credit Online – PNC Personal loan 2021 Review | Fintech Zoom | Fintech Zoom

Published

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Loans Bad Credit Online – Loans Bad Credit Online – PNC Personal loan 2021 Review | Fintech Zoom

Loans Bad Credit Online – PNC Personal loan 2021 Review

Top perks

Low minimum loan amount

Customers can borrow $1,000 to $20,000. That minimum loan amount of $1,000 is unusual in the personal loan industry. A low minimum threshold means you can get the cash you need to cover small emergencies without being tied down to a larger loan.

Wide range of repayment terms

You have between 6 and 60 months to repay the loan. There are pros and cons to longer repayment terms, so this flexibility allows you to customize your term to your situation.. With PNC, you have the option of designing a repayment plan that fits your monthly budget.

Joint applicants welcome

Whether you need a joint applicant’s high credit score to qualify for a lower loan interest rate or someone has decided to co-assume responsibility for a personal loan, PNC allows for joint applicants.

What could be improved

Terms depend on location

The first thing you will be asked is where you live. On its loan homepage, PNC states that “PNC product and feature availability varies by location.” While this may be good news for borrowers in some areas of the country, it could be bad for others. You’ll need to see what it means for you.

Lowest interest rate reserved

If you’re looking to borrow enough to make repairs to your roof or buy a new furnace, you might not borrow enough to qualify for PNC’s lowest advertised interest rate. That’s because that low interest rate is reserved for those borrowing more money. For example, PNC will automatically assign a $5,000 loan a higher interest rate than a $15,000 loan.

Loans Bad Credit Online – PNC Personal loan 2021 Review

Tags: Loans Bad Credit Online

Loans Bad Credit Online – Loans Bad Credit Online – PNC Personal loan 2021 Review | Fintech Zoom

Tags: Loans Bad Credit Online

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