Do you want to buy a car with bad credit, but you are afraid that you will be paying a very high interest rate?? In most cases it is true that the better your credit score, the lower interest rate you will pay. A lower interest rate is important because the lower the rate, the less your monthly car payment will be. If you have low (or no) credit, luckily there are some steps you can take right away to improve it.
Pay off debt
Did you know that the average U.S. household has around $15,000 of debt? If you are in debt, don’t stress because you aren’t alone. HIgh numbers of debt can have a negative impact on your credit score. First step is to pay off the debt that has the highest interest rate. A lot of the time your highest interest rate is on credit cards, so check which of your credit cards have the highest rate and pay those off first.
Accumulate more credit
Just having credit history can help your credit score, plus it is important to lenders to see that you have some credit history before they give you a loan. If you don’t already have a credit card, you will want to consider getting one. Do some research and see which financial institutions offer the best credit card for you. Many have benefits including 0% interest for a period of time, or cash back on purchases. Having a credit card and paying your bill on time is important to helping your credit score.
Keep credit balances low
Just because you have a credit balance of $10,000 on your credit card doesn’t mean you should use it all up. Try to only use your credit card when you need it. It’s okay to make payments on your credit card as long as you make them on time. Late payments can get turned into the credit bureau and impact your credit history. Making all your payments on time should help your credit score over time and help you reach your goal of purchasing a new car.
Talk to WA Auto Credit
Do you know what your interest rate would be with your current credit score? It might be better than you think! WA Auto Credit can help you decide if it is worth attempting to improve your credit score before you purchase a car, or if it is a good choice to act now. For information on a fast auto loan, contact Washington Auto Credit today!