Are you looking for bad credit car loan nz? Getting a car loan with bad credit can be tough. Generally it will be a lot harder to get approved and you need to be careful that you won’t get taken advantage of with high interest rates.If you have bad credit and are thinking of applying for a bad credit car loan nz get prepared as best you can before you apply. A finance company won’t want to see a history of missed payments, high debt or repossession.
The best idea is to get your current finances in order, pay off any outstanding debts like credit cards or hire purchases. You’ll also be much better off if you have full time employment and your weekly expenses do not exceed your income. This will show the finance company you have the extra money to make your car repayments.As a general rule, when applying for bad credit car loan nz if you are successful you will pay a higher interest rate because you are more of a risk to the finance company. Following are a few techniques to help you get prepared before you apply.
6 Tips to get a bad credit car loan nz
Here are our top 5 tips to help you get the best car finance interest rate when applying for a bad credit car loan nz:
1. Have full time employment or a regular/stable income
2. Pay off as many outstanding debts as you can before applying for car finance – credit cards, hire purchase, bank loans etc.
3. Save as much money as you can for a deposit. This will show the lender you can save money and that your income exceeds your expenses. It will also reduce the size of your loan amount.
4. Shop around. Look at 2-5 finance companies and choose the best rate and agreement you can find.
5. Make sure you know what you can actually afford! If you had an unexpected bill could you still make your car repayments? And remember, you’ll have things like car insurance to pay each month, registration, new tyres… the list goes on. Make sure you allow for all the extra expenses that come with getting a new car.
6. Check out the Compare Car Finance Calculator and see what your repayments would be per week or month. You can adjust the interest rate, the length of your car loan and the total amount you want to borrow. Visit www.compare-car-finance.co.nz to see what your car loan repayments could be.
How can I check my credit report in NZ?
If you think you have bad credit rating in New Zealand but are unsure or just want to check your credit history, you can get a free credit report from the Centrix website.
Once you have your report you will get a clearer picture of your current financial situation and this will help you prepare before applying for a bad credit car loan nz. Make sure any bad debts on your report are paid off and complete.
You’ll have a much harder time securing car finance with bad credit if you still have existing payments owing from previous purchases.
Can I get a good car finance interest rate with bad credit in NZ?
As a general rule if you have a bad credit rating in NZ your car finance interest rate will be higher when compared to someone who has a good credit rating. Although it is unlikely you will get the best interest rate, there are steps you can take to make sure you get the best rate for your personal situation.
Firstly, shop around. Car finance companies may say they will look after you and have your best interests in mind however this is not always the case. People often end up not being able to make their car finance repayments because they agreed to high interest car finance and repayments that were too expensive for their income.
Different car finance companies will offer different rates so look around at what is available and you will likely find the best car finance rate for your personal situation.
What fees should I look out for when financing a car?
When you finance a car in NZ your agreement will include some or all of the following types of car finance fees:
1. Interest rate. Your interest rate is the amount you will pay on top of the price of the car. For example if your interest rate is 10% and your vehicle is $30,000 you will pay a total interest amount of $3,000.
2. Finance establishment fee. The establishment fee is a one-off fee charged when you take out the loan. Establishment fees will vary and could be anywhere from $150 – $500.3. Late payment fee. The finance company may charge for late payments, missed payments. Definitely check what charges apply when making your decision. If something happened to you and you missed a payment, what would you get charged?
4. Early repayment fee. If you decide to pay off your car finance early you might find the finance company charges an early repayment fee or break fee. This fee is in place so the finance company can recover any loss of income from your early repayment. Ensure you know what the costs are here in case you do decide to pay your vehicle off earlier than expected.
A lender must provide a disclosure statement by law which outlines all fees and charges that may occur. Make sure you read this thoroughly before proceeding with a car loan so you know your costs that will occur in different situations.