If your credit isn’t so fantastic, then you might be thinking that buying a used car is an impossible thing to do. The good news is that although your credit rating does have an impact on your ability to finance a car, cleaning it up isn’t as tough as you might think. If you make a commitment this new year to take steps to clean up your credit score, you can be driving away in a used car in no time. Here are five tips to get you into the used car of your dreams.
1. Establish a credit history
Sometimes the reason that people’s credit scores aren’t all that great has nothing to do with their history. Rather, there is the potential that it is the lack of credit history that is setting you back. When a financier looks to make a loan, they want to see what your payment history is so that they can decipher if you are risky or not. So, even if you have been responsible and never used credit cards, that might actually be working against you. To establish a credit history, take out a credit card and use it for your transactions. Just make sure to pay it off every month and not to carry a revolving balance. An accumulating balance will actually work against you.
2. Pay off any credit cards you do have
If you are carrying high credit card balances, pay them off as soon as you can. Start by paying more than the minimum to put a dent in them. The more you can pay them down, the better. Instead of stopping for that afternoon frappuccino, put that money towards paying off your credit card balances.
3. Pay your bills on time
Credit reporting agencies count delinquent payments as a negative knock. So, always pay your bills on time. Sometimes just being 30 days late can really affect your credit rating. So, pay your bills as they come instead of waiting, then you are less likely to forget one.
4. Look at your credit score to make sure that everything is correct
If it has been a while since you have seen your credit report, then you will want to take a look at it and make sure that there aren’t any discrepancies. If you notice something on your credit score that isn’t correct, you do have the right to dispute it. If you notice a late payment that is incorrect, you can dispute it through the reporting agency, and sometimes they will find in your favor, which can increase your rating.
5. Pay off any collections
If you have bills that have gone into collections, it is very important to pay them off and address them immediately. Having a collections notice on your credit rating might be hurting your score significantly. If you notice any collections that you didn’t know about, find out who to pay, and do so, to get them off of your record and to increase your overall credit rating.
If you are dreaming of a used car this new year, but your credit score is less than stellar, it is possible to turn things around and get financing. It might take a couple of months, but if you pay attention to what is tanking your credit score, dispute reporting that might be false, and start to pay off your credit cards, then you can be driving away in the used car of your dreams in no time.
Let the professionals at ridetime who are expert at finding even those with not-so-excellent credit rating, financing options, give it a try. Stop by our dealership and let us help you get the money you need to buy the used car of your dreams.