Credit Dents & Dings?
Buying a car without perfect credit — 101
When applicants apply for loans like the classic “0% APR”, they usually get disappointed when discovering the whole story. To start with, most folks (we estimate about 90-95%) simply don’t qualify for these promotional rates. It typically takes a delicate balance of the very highest credit scores, excellent debt-to-income ratios, the right amount of time on the job, shorter finance periods, etc… in order to get approved. The ones that do qualify for 0% financing would often do better if they had simply opted for the large dealer rebate(s) instead and financed at a normally good rate. The truth is these promotions are simply gimmicks to get a steady stream of people into the loan departments of car dealerships. Applicants are then strategically “switched over” into the mindset of doing whatever it takes to drive away in a new car that day. An applicant often takes a deal and financing that they shouldn’t. Then to make things worse, finance managers typically send the applications to multiple finance companies which cause damaging strikes on the applicant’s credit report so if they don’t accept a loan they are still penalized on their credit report for simply applying. These are known as hard inquiries and too many of these appear to the credit bureaus as someone who is aggressively seeking credit which causes a red flag. If too many inquiries are made, it can result in lower credit scores for months.
Here at Horizon Credit Union, our staff works for the members, who actually own the credit union. We have a set of by-laws designed to keep rates fair and although we price our loans based on credit scores, we don’t make loan decisions based on them. We understand that “life happens” and in many cases credit can be damaged by anything ranging from unexpected illness to divorce or sudden job loss. Unlike most other lenders, Horizon CU has always operated with that in mind and we strive to provide the best financing options available regardless of “dents and dings”. We are here to protect our members from predatory lenders and “bait and switch” tactics found in most financial institutions and we’ve been doing that now for over 80 years.
Become a member of the best little credit union in Kingsport and see the difference for yourself!