When applying for a bad credit car loan, you can do a lot of things to increase your chances of approval, but there are some things that will automatically let you reject it. Here's a list of things you should never do.
1] Don't overestimate your income - Subprime lenders have very strict "debt and income" guidelines that they must follow. If you overestimate your income, your loan will be rejected during the verification process. All subprime lenders will apply for the most recent payroll at some point and verify your work with your employer over the phone. If you are not sure that your total monthly income is always low in your application, it would be better if you prove more during the verification process.
2] Don't overestimate your stay time - most lenders will need 5 years of living history. Stability is very important to lenders when deciding whether to approve a loan. When you show the lender how long you have lived somewhere, they need to know that you really live there or live there. Most lenders will ask you to show some type of proof of residence; examples of this are recent phone bills, utility bills, and even a copy of your lease. Sometimes people mistakenly list long stays because they have been living in the same area for a long time. This will reappear during the verification process. No matter how short, you must know your living time accurately. Lenders prefer to keep your residency history accurate and documented, not inaccurate.
3] Don't overestimate your working hours - most subprime lenders will require at least 5 years of work experience. It is also important to know exactly what your current and previous working hours are. Don't mistakenly put long-term work into your app because you have been working in the same industry for many years. Provide the lender with an accurate list of all employers you work to cover a five-year history. Name and phone number will help speed up the process. They will verify the information you provide to them.
4] Don't choose the most expensive car you can find - when you apply for a bad credit car loan, it's important to remember that you are in rebuilding mode. It's not time to pick your dream car. Subprime lenders will only approve your loan to match your budget. After you submit your application, they will calculate your debt ratio based on your current financial situation to determine what payment they think you can afford. It is important to keep the parameters they are willing to approve, otherwise you will be rejected. Once you start paying in time and your credit score starts to increase, you can buy the car you've always dreamed of.
Orignal From: What you should not do when applying for a bad credit car loan
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