Michigan Car Loan: Auto Loan Financing, Bad Credit Tips

Many Michigan car buyers may feel discouraged when thinking about trying to get a car loan in Michigan. Michigan is going through tough economic times, to say the least. However, there are still car loans being given in Michigan. But there are some standards you must follow in order to get a loan.

There is not much mystery when it comes to car loans. The challenge is getting the best car according to the situational reality of the car loan applicant. Since it is financing, the applicant's employment situation and financial history will play a big part or not in whether that loan comes through. So let's take a look at the areas to be considered when applying for an auto loan:

Credit History

• Credit score and debt situation are maybe the most important factors for getting a car loan. One factor to cause the current economic woes are credit problems and defaults. Because of this recession cause, automobile dealerships, banks and other loaning institutions are being tougher when it comes to credit loans. So it is important to know your current credit status and capabilities. And you may want to consider some other things before going through the loan application process.

Want vs. Need

• A walk around a new and used car lot will get the brain juiced up to buy a car. The color, model, fuel efficiency and low maintenance history are just a few factors that can pull the buyer toward his or her auto desire. And if you have the financial security and freedom then fulfilling that auto desire should be easy. However, for most of us we have to be realistic and find a car that we like and is practical. Meaning, it can get from point A to B and is affordable. Obviously there are other things one would want in a car, but to get a loan one must start with a car that fits the buyer's reality.

Employment Status

• If the car loan applicant wants to be ready for the scrutiny of the dealer's financing department and the local bank then he or she must have a job. Income coming in and being used to pay bills to establish credit is where it is at as far as trying to get in the present game of car loans. The givers of car loans want to see some financial security if they are to loan the buyer on credit of payback.

Local Banks/Financial Institution

• The auto dealer wants to sell cars and the bank wants the buyer's business. The car loan applicant just wants to get in that car. However, don't expect a quick approval of a car loan. It may take time and some work. Be prepared to show the bank evidence of employment and financial status. Have the paperwork in hand and ready. It doesn't hurt to have an idea of how you can budget things to get ready for paying down the loan each month. Finding a co-signer is not a bad idea.

Interest Rates

• The interest rate on the car loan is dependent on the buyer's credit status and ability to pay off the loan. If the rate is high then it is important to have a secure, paying job. The better prepared a buyer is going in to a car loan process the better the outcome will be.

Car loans are still being given out readily just as long as the car loan applicant is ready to endure much more examination then they may expect. Keep in mind your entire situation from needs to ability to make a monthly payment.