Canadians who have bad credit need to start shopping for a car as soon as possible. The Bank of Canada is rising interest rates to try and slow inflation.
Inflation is at an all-time high and may take years for the damage of unbridled money printing.
Right now, the prime interest rate is at 1%. That may not seem like a lot, but this represents a massive increase when at the start of 2022, the interest rate was 0.25%.
If you are having credit issues, it will make all of your credit facilities, including car loans, more expensive.
As inflation drives up rising interest rates and the prices of both new and used cars, you need to move fast if you want to buy a car, or you could be priced out of the market.
Identifying the root cause of your low credit score
You need to work on your credit issues to never have to pay higher interest rates again.
Start by signing up with free services like Equifax and TransUnion, these companies offer paid services, but their free service is sufficient.
When you have access to the credit report, you must look for any negative items; if your credit score is in the low 600s, there could be missed payments that may soon end up in collections.
Your repayment history is the single biggest variable that goes into calculating your credit score, so you need to bring all of those accounts up to date as soon as you can.
You should also work on your credit utilization; this is the total amount of debt you are carrying in relation to the total amount of credit you have available.
The recommended amount is 30%, but the less debt you are carrying, the more money you will save on interest.
Having the right car buying expectations
We touched on earlier that car prices are on the rise; you could easily spend $50,000 for a new vehicle.
Since you have bad credit, you will not be able to get a loan for a brand new car, so your best option is a good quality used car.
There is a tight supply of used cars available in the market, but you can still find a good deal provided you are willing to move fast.
Where to get the most competitive car loans in Simcoe with bad credit
There are lenders that are willing to give you a bad credit car loan in Simcoe.
These lenders are not found online. To gain access to these lenders, you must go through a local car dealership that specializes in this type of financing.
The dealership has credit experts available who can show you the steps that need to be taken to repair your credit score.
Since these dealerships already have cars in their existing inventory, you can start taking these vehicles for test drives until you find the one you like the most.
You must follow these steps when trying to buy a car in Simcoe with bad credit, so be sure to head down to your local dealership right away.
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