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The truth about subprime car loans in Canada

Posted by on Sep 13, 2022 - Archived under Bad Credit Car Loan Tips

Are you interested in learning more about auto loans for those with poor credit? If you’ve recently been turned down for a car loan, you may want to know how the entire procedure works.

Our mission is to assist Canadians in learning more about the market for subprime auto loans and how to purchase a car with total assurance.

What is considered “subprime” has no accepted definition

It’s important to note right away that there is no universally accepted definition of what a subprime auto loan is.

Every lender has its own guidelines for loan underwriting, therefore one lender may categorize a person as a top borrower while classifying another as a subprime borrower.

Remember that there are a few things you should be aware of while financing a vehicle. First, you can be classified as subprime if your credit score is below 620 or it is difficult to verify your income.

This doesn’t mean you’re a nasty person; it just means you’ve had trouble making timely payments on your own bills in the past.

A free credit monitoring service like Credit Karma might be something you want to sign up for. These applications provide free, real-time access to your TransUnion credit report and score.

It will be simpler to assess your situation if you have access to your credit report, allowing you to start working on raising your credit score.

Why improving your credit score is crucial

Your credit score fluctuates each month based on how you’ve managed your finances over the previous 30 days, so it never stays the same.

If you make timely and proper payments on your bills, your credit score will increase.

Along with paying your bills on time, you should make an effort to pay off as much debt as you can.

Because the Bank of Canada is hiking interest rates, borrowing money will cost you more even if you have good credit.

Maximizing your financial resources

Now is an excellent time to review your spending plan and begin performing some calculations to identify areas where you may save costs.

You may be able to save money by cancelling your subscription services if you have stopped using them since the pandemic finished.

Consider acquiring a second job if you’ve done all you can to reduce your spending but still don’t have much room. By doing this, you’ll learn new skills and increase your income.

Where to find the best auto loans in Canada for those with bad credit

Your journey to this page likely began with an online search for auto loans. Even if it makes sense to conduct online research, you should heed our recommendation and work with a nearby dealership.

A dealership will spend time getting to know you so they can determine which lender is ideal for you.

These nearby dealerships are aware of all the Canadian auto financing companies and which ones offer the best deals.

You must first contact these dealerships in order for them to help you receive a fantastic bargain on a new car.

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!

Let’s get in touch! 

Dixie Auto Loans