In my time of assisting our lending partners I have seen a lot of different scenarios and a lot of different outcomes. Recently, I talked with a finance manager that had two customers. The first clearly had a better credit score, more stable income, and less bad credit history than the second. In the end, the second drove off with a car and are well on their way to re-establishing positive credit. The first is still without a car and at this point may be on their way to not being able to buy one at all.
What happened? Well, first off, this plays out over and over without, it seems, a way to prevent it. Both customers were contacted. The second customer was patient and diligent in providing all of the documents and information the finance manager requested. When it came to being a little flexible on things, they realized that they needed to get re-established before they could ask for the world. They were happy to do what it would take to make it work. “when I first got the application I knew this would be a rough one but the customer was open and patient with the process and eventually we were able to figure out a way to get them a car that they are very happy with.” – Finance manager. The first customer however, said they were not even willing to come down, despite being told they were approved, until the finance manager told them all of the terms of the auto loan. “Their usually isn’t a way to know exactly what the terms will be until we find out what car will work. Many times the lenders will want the whole deal structure and all of their documents faxed before they give us a structure at all. Not to mention that thanks to new privacy policies we are not allowed to discuss finance over the phone even if we knew.” So eventually the first customer sent their auto loan application all over the place. Now when you send an application in, finance managers will more than likely have to try to contact several programs to get an approval or the most competitive terms. If you send your applications to five or six finance managers and they each send your application to three or four lenders you are going to have excessive credit inquires on your credit bureau and may no longer qualify.
So, you need a bad credit auto loan, what should you do? Make sure you are dealing with a place that has a special finance department. These finance managers only deal with situations just like yours all day long. They know what they are doing and they have special programs for bad credit situations. Be patient and work with them. Understand that these are people too, just like you they have a job to do and a little bit of respect can mean a lot, especially when they get a lot of people that won’t give it. Also, you will want to gather up some important documents so that you have them ready when necessary. Proof of income, proof of address, Insurance info, some references and figure out what you have available for a down payment before you talk to them so you aren’t fumbling to figure this out over the phone.
