BuyingCarswithBadCredit.com – Jacksonville, FL – Getting approved for auto financing without a cash down payment can seem like an impossibility if you have bad credit. There are however, easy ways of getting this accomplished with two things. One, knowing how down payments work in car finance and secondly, understanding what type of lender you should obtain your financing with.
Down payments in auto finance, work by reducing the amount financed. Simple enough, right?Well, it goes a bit deeper than that. Ever since the days of credit applications, numbers have been moved around to make things appear more favorable for the applicant. It is a common practice in car dealerships for the price to be inflated to the maximum retail price, with a “down payment”that reduces the amount requested down to the actual amount that is needed.
For example, if you were to buy a $10,000.00 auto, and the amount needed for a no down payment loan is $10,600.00, then the dealer can show the price as being $12,600.00 with a down payment of $2,000.00. The end result is the same, a loan for $10,600.00. It looks better to the lender, though. Making this work depends on a number of factors. Whether or not the vehicle will actually “book out”for a higher amount as well as, if there is a trade-in involved.
The same can be done with trade-ins.
Let’s say that you have a vehicle that the dealer will put $2,000.00 into and you’re looking at the same $10,600.00 vehicle as in the example above. The total amount needed for a loan is $10,600.00 minus your $2,000.00 trade-in, which is $8600.00. If the vehicle you’re buying can “book out” at $12,600, then the dealer can show the price as being $14,600.00 with a trade “allowance” of $4,000.00. The end result is an $8,600.00 loan. Or, the $2,000.00 for your trade can be shown with a “dealer cash rebate”of $2,000.00 applied.
Dealers in Jacksonville do this everyday and it takes some creativity to keep things in-line so that they work out, as well as, keeping it ethical. There are so many variables in a car deal that it can make your head spin as they get moved around.
It may be that you’ve not been able to get the numbers worked out, or a good approval at a local dealership that has tried. You may wish to consider online lending sources as a viable alternative.
Get info on buying a car with bad credit in Jacksonville at BuyingCarswithBadCredit.com.
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