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Bad Credit Car Loans Houston

Credit history is what many financers look at when they decide the interest rate or to determine if you are eligible for a loan at all. When you are looking to buy a car in Houston but have a low credit score, you might be looking for the best bad credit car loans Houston Tx region has.

Best interest rates are available to those with higher credit scores. In 2016, there was a 4 percent growth in the loan amount overall compared to 2015. The average amount in 2016 for new vehicles was $30,022, while for used cars, the amount was $19,227.

What is the credit score all about?

Your credit score is calculated based on many factors, and each of the agencies can use different parameters to arrive at your score. Some of the factors used include:

  • Unpaid debts that you have currently
  • History of your debt payment
  • Number of loans you currently have
  • Duration of these loans
  • Whether you have made new credit applications

There are many sources to obtain your credit scores including Experian, FICO, Equifax and so on. Experian has a model that ranges from 300 to 850. Super prime borrowers have a score of 781 and above, while those in deep subprime have scores between 300 and 500. Prime borrowers have scores above 661 while the non-prime category of borrowers has scores between 601 and 660.

Close to 57 percent of loans were given to super prime and prime borrowers, and some went to the nonprime borrowers. Deep subprime and subprime continue to see less and less of the market share when it comes to auto loans.

Credit scores and interest rates

Loan interest rates depend on your credit scores. On an average, new car buyers who obtained financing had 714 as their credit score while used car buyers had a score of 655. In 2017, as per a report from Experian, 713 was the average score required for new car loans while 656 was the cut off for used cars.

Although 20% of loans are given to buyers who have a below 600 credit score and 4% to people with less than 500, the rates of these loans are higher. While a score of 700s can have rates around 5%, those with a score of 500 may have to pay rates as high as 15% as per Experian.

If you borrow $20,000, you will have to pay $483 for a loan term of five years as compared to $378 that will be paid by a buyer with a better credit score.

Bad credit car dealerships Houston

Those searching for the most convenient bad credit car dealerships Houston region has will find Houston Direct Auto to be the ideal option. As the leading provider of bad credit auto loans Houston region has, we  specialize in loans without credit checks for APRs as low as 2.49%.

Easy financing for used cars no credit check required is our motto!

Contact us for the most suitable bad credit auto loans Houston area has!

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