A new car purchase can be an exciting time, especially if this is someone’s first car. However, those who are buying a car for the first time and those who have bad credit could face some road blocks when applying for their car loan. Little to no credit and poor credit can affect someone’s ability to get a decent rate on their auto loan. It may take some work, however, there are ways to boost ones credit score quickly, while making their loan application look more appealing to lenders.
Those with a poor credit history can start by looking at what is on their credit reports. Things to look for include out-of-date information, incorrect information and items that do not belong to the car buyer. Negative information, with the exception of a bankruptcy, should be removed within seven years. Incorrect and out-of-date information can be removed from a person’s credit report by contacting the credit reporting agency and request it be removed. Items will be removed only if they are not able to be verified and proven to be correct.
When looking to make any major purchase, including looking at used cars in the Orlando area, it is important to keep balances on all other lines of credit down to a minimum. Paying down these lines of credit can boost the car buyer’s credit score a substantial amount in as little as two months. Also, paying bills on a timely basis will help boost a person’s credit score.
For those with credit cards, it is important to not close any of these accounts. Closing the account will appear as “closed” and could affect the credit utilization ratio. Thus, lowering a credit score.
For those without any lines of credit on their credit reports, it might be best to consider opening a secured credit card. These are available at most banks. In exchange for opening a savings account with as little as $300, the bank will issue the consumer a credit limit for the same amount. Pay this on time over a few months and watch as credit scores start to rise.
Those wishing to purchase a new car or truck should take the time to look at their credit report. This will give the car buyer a good idea where he or she stands. If necessary, sit back and take a few months to boost the credit score. This can help any car buyer improve their credit score’s appeal and increase their chances of getting a better interest rate.