Some people have a lot of small loans. The monthly payments add up to more than 35% of their monthly incomes. In a situation like this, it will be increasingly difficult for you to meet those monthly payments. Especially if you have any kind of emergency financial situation to deal with.
The lender will also want to use the value of the vehicle as security for the car loan. If for example, you cannot meet the monthly payments, they will reclaim the car. Then sell it to get their money back. You get whatever is left however after fees and penalties, there is not usually anything left. So if you do get approved for a car loan with bad credit make sure you meet all of the monthly payments. Focus on repair your credit rating.
For more posts about what to do about bad credit, click here.
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