Rebuilding Credit Via Car Loan

Rebuilding Credit Via Car Loan

At Big Red Kia in Norman, Oklahoma, we often see people trying to re-establish their credit through means of a car note.  Whether a stretch of medical bills or coming out of a bankruptcy, a car loan is a wonderful way to show the lending community that you are worth lending credit.  A year to a year and a half of consistent on time payments in addition to making sure all other bills are paid on time, your credit bureau score will gain traction.

A couple of things we would encourage when visiting the dealership.  First, try to have set aside anywhere between $1000 to $1500 to put as a down payment.  Banks love to see customers put some skin in the game and as long as you make a minimum of $1800 or more, lenders like CAC often will take a chance on you.  If you don’t have down payment, the next best option would be a free and clear trade. A hunk of junk worth $500 or a motorcycle, something of some value to give to the car deal to once again, give the lender some equity towards your car deal.  Maybe you’re coming out of a rough spell but with diligent consistency and a little planning, you’ll have your credit back on track.

- The Buzz