Canadians who want to buy a car and just recently went through a consumer proposal are in the right place.
Our goal is to show you what steps you must take in order to get approved for a car loan and start leading your best life.
Car loans are a fact of life in Canada
While everyone would like to have the means to buy a new car with their savings, inflation and the skyrocketing housing costs are eating up what little savings the majority of Canadians were able to squirrel away during the pandemic.
The average Canadian is not able to come up with the $30K needed to buy a new car on the spot, so financing is the only viable option.
How a consumer proposal impacts your credit score
When a consumer proposal is registered by an insolvency trustee on your behalf, all of your creditors agree to get paid less than the amount agreed upon and to give you more time than originally agreed.
The lenders will leave negative comments on your account, and while technically, you do not owe the debts in full anymore, the ramifications of the consumer proposal will put downward pressure on your credit score for quite some time to come, upwards of seven years in some cases.
You need to start rebuilding your credit score, so like the phoenix, you can rise from the ashes of financial hardship and start leading a better quality of life.
How to rebuild your credit score on a budget
There are a few things you can do to help rebuild your credit.
The first is to sign up with credit monitoring apps like Borrow Well, which lets you monitor your credit in real-time.
When you have access to your real-time credit score, sign up for a Capital One secured MasterCard. This card will create a new tradeline on your credit report.
Once you receive the Capital One card, be sure to make your payments on time every month, and you will start to see your credit score improve.
This will take a few months, but the long-term benefits are well worth the mild inconvenience you experienced signing up for the card.
Where to get a car loan today when you have a consumer proposal on your credit report
Should you find yourself in a situation where you need a car right away because your current vehicle is not reliable, there are options available.
Start by contacting your local car dealership that specializes in helping credit-challenged borrowers like you.
The dealership will be able to give you a fair price to trade in your current vehicle, which can be applied as a down payment on a new car loan.
What you need to do is have an explanation of why you ended up in the consumer proposal. The dealership will use that information when negotiating with prospective lenders on your behalf.
Now that you know how to buy a car in Canada with a consumer proposal, you should contact the dealership right now and get things rolling.
For those of you who know that you have a challenging credit situation, please visit Dixie Auto Loans where we have a team of credit specialists ready to help you get approved for a car loan today!