You’ve just learned that your request for an auto loan with the Bank has been denied. The loan officer explains that the decision has to do with your credit. Banks lend only to prime borrowers; your credit situation places you squarely in non-prime territory.

Non-Prime. You’re not sure exactly what it means, but it sounds like a condemnation that will forever brand you as being somehow deficient to lenders.

However, being deemed Non-Prime doesn’t necessarily mean that your borrowing days are over. It may still be possible for you to get that sought-after car loan.

But first you need to understand the term that defines you. A Non-Prime borrower is one with No Credit or Bad Credit. Each lender has its own definition of what constitutes a Non-Prime borrower, but typically, a credit score of less than 620 lands you in this less-than-desirable category. For more information on credit scores, and what sort of factors cause them to suffer, please see Getting Credit in Canada .

There are four credit grantors specializing in Non-Prime lending who are eager and willing to loan money to those with bad credit. Naturally, though, there’s a catch. The interest rates for Non-Prime borrowers are frequently quite steep — significantly steeper than those paid by their more credit-worthy?

So, now that you understand what your options are here are a few tips:

• Check your credit report. Make sure that everything on your report is accurate; it could be that information has been entered in error, and that your credit history is a lot less blemished than you’ve been led to believe. If you do find information on your report that is inaccurate, you need to address it right away. Contact the credit bureaus in writing, listing your name and address and clearly detailing the nature of the error.

• Access your credit score. For a long time, credit scores were available only to prospective lenders, who used them to evaluate those seeking loans. That has changed; it’s now possible for consumers to access this all-important number. Your score is available online from the credit bureaus: Equifax. If you’ve got bad credit, it’s helpful to know it beforehand. Knowing your credit score will help give you a sense of exactly where you stand in your search for an auto loan.

• Don’t rely on the Dealers. Dealers take a cut of all car financing deals they land; as a result, any loan that they’re able to get you with a bank or financing company is likely to wind up being more costly to you than if you had contacted the lending institution on your own. Ideally, you’ll want to secure your auto loan before setting foot inside the dealership. Auto Source Financial can get you Pre-Qualified for your Vehicle Loan and help you find the Car you’re looking for at a far cheaper price.

• Shop around. Rates will vary from lender to lender; take the time to look around and see what deals are available. Lenders typically define their business according to credit tiers (A, A- and so on.); speak with loan officers regarding how each tier is linked to credit score and interest rate. Ask for a matrix detailing the tiers and their implications; having something in writing from each lender will make it easier to compare your options effectively. If you have a checking account, make sure to include your bank in your search for a loan. Many banks have entire departments dedicated to providing loans to those with flawed credit, and they tend to look more favourably upon applicants who are current clients. Your credit union is also a good place to turn. For years, credit unions have had a reputation of lending only to members with good credit, but that’s begun to change. Many are now beginning to expand their business to include those with less-than-perfect credit.

• Remember that your credit score is malleable and ever-changing. When it comes to your credit history, the ball is entirely in your court. You can improve your bad credit by paying your bills on time, and not overextending yourself when it comes to loans and credit cards. With proper attention paid to the state of your credit, you could conceivably hoist yourself out of Non-Prime territory in as few as two or three years. Going forward, check your credit score at least once annually. You may have to pay more than you’d like for the auto loan you’re about to receive, but in a couple of years, if your credit score has improved, you’ll probably be able to refinance your loan at a much lower rate.

Bad Credit Car LoanYou’ve just learned that your request for an auto loan with the Bank has been denied. The loan officer explains that the decision has to do with your credit. Banks lend only to prime borrowers; your credit situation places you squarely in non-prime territory.

Non-Prime. You’re not sure exactly what it means, but it sounds like a condemnation that will forever brand you as being somehow deficient to lenders.

However, being deemed Non-Prime doesn’t necessarily mean that your borrowing days are over. It may still be possible for you to get that sought-after car loan.

But first you need to understand the term that defines you. A Non-Prime borrower is one with No Credit or Bad Credit. Each lender has its own definition of what constitutes a Non-Prime borrower, but typically, a credit score of less than 620 lands you in this less-than-desirable category. For more information on credit scores, and what sort of factors cause them to suffer, please see Getting Credit in Canada .

There are four credit grantors specializing in Non-Prime lending who are eager and willing to loan money to those with bad credit. Naturally, though, there’s a catch. The interest rates for Non-Prime borrowers are frequently quite steep — significantly steeper than those paid by their more credit-worthy?

So, now that you understand what your options are here are a few tips:

* Check your credit report. Make sure that everything on your report is accurate; it could be that information has been entered in error, and that your credit history is a lot less blemished than you’ve been led to believe. If you do find information on your report that is inaccurate, you need to address it right away. Contact the credit bureaus in writing, listing your name and address and clearly detailing the nature of the error.

* Access your credit score. For a long time, credit scores were available only to prospective lenders, who used them to evaluate those seeking loans. That has changed; it’s now possible for consumers to access this all-important number. Your score is available online from the credit bureaus: Equifax. If you’ve got bad credit, it’s helpful to know it beforehand. Knowing your credit score will help give you a sense of exactly where you stand in your search for an auto loan.

* Don’t rely on the Dealers. Dealers take a cut of all car financing deals they land; as a result, any loan that they’re able to get you with a bank or financing company is likely to wind up being more costly to you than if you had contacted the lending institution on your own. Ideally, you’ll want to secure your auto loan before setting foot inside the dealership. Auto Source Financial can get you Pre-Qualified for your Vehicle Loan and help you find the Car you’re looking for at a far cheaper price.

* Shop around. Rates will vary from lender to lender; take the time to look around and see what deals are available. Lenders typically define their business according to credit tiers (A, A- and so on.); speak with loan officers regarding how each tier is linked to credit score and interest rate. Ask for a matrix detailing the tiers and their implications; having something in writing from each lender will make it easier to compare your options effectively. If you have a checking account, make sure to include your bank in your search for a loan. Many banks have entire departments dedicated to providing loans to those with flawed credit, and they tend to look more favourably upon applicants who are current clients. Your credit union is also a good place to turn. For years, credit unions have had a reputation of lending only to members with good credit, but that’s begun to change. Many are now beginning to expand their business to include those with less-than-perfect credit.

* Remember that your credit score is malleable and ever-changing. When it comes to your credit history, the ball is entirely in your court. You can improve your bad credit by paying your bills on time, and not overextending yourself when it comes to loans and credit cards. With proper attention paid to the state of your credit, you could conceivably hoist yourself out of Non-Prime territory in as few as two or three years. Going forward, check your credit score at least once annually. You may have to pay more than you’d like for the auto loan you’re about to receive, but in a couple of years, if your credit score has improved, you’ll probably be able to refinance your loan at a much lower rate.

Get a Guaranteed Car Loan in Canada

Author: Auto Source Financial

If you’re New to Canada or New to Credit getting a car loan can be a very difficult task. Many people who have never had credit in Canada are continually being turned down for financing because they have zero credit.

Many of our past customers have said:

“How am I suppose to get credit if nobody will give it to me”

This is a fair question that needs to be answered!

When you go to a car dealership the Business Manager –Finance Manager takes your credit information such as you name, address, birth date and employment information. Many times Business Managers will not check your standing with Equifax and submit you to ever bank in their portfolio in hopes of a credit approval.

By doing this the Business Manager is actually hurting your Credit! If you have never had credit or applied for credit before it’s very important to limit the number of enquiries on your credit report. The more enquiries you have lessons the chances you have of getting credit.

What happens is one Bank checks your credit and sees another Bank also checked your credit. Then they assume well the first bank turned them down so why should we approve them. Thus another turn down from the Bank and another hit against your credit score.

Auto Source Financial has specially trained credit analysts who understand Canada’s credit reporting system and can work with you to obtain New Credit in Canada even if you had Bad Credit in the Past.

Our Credit Specialists with also help you obtain a Credit Card and tech you how to take your credit score for (N) to 750 within 6 months.

Take the right steps to obtaining credit in Canada the right and easy way go to www.autosourcefinancial.com and apply on line. We finance your future no your past!

About the Author:

Auto Source Financial is a Canadian Financial Firm that assists people with No credit or Bad Credit Obtain Vehicle Financing. We Specialize in New Immigrants and Foreign Student Vehicle Loans.

Article Source: http://www.articlesbase.com/cars-articles/get-a-guaranteed-car-loan-in-canada-759778.html

Trying to get a Car Loan in Canada with no credit or bad credit can be a tiresome task. Many people go to car dealerships thinking the finance managers can get them approved for a car loan regardless of their credit history? The truth is many if not most car dealer finance managers have little to no experience in consumer credit. Many Finance Managers or Business managers are ex car salesman or have taken a Business Managers course for a few weeks and then learn by trial and error. Most times they just submit your credit information to all financial institutions and hope for some form of credit approval. Many times they don’t even analyze your credit profile prior to submitting your information to the financial institution. Then when all the financial institutions have declined your credit application they inform you that they were unable to obtain a car loan for you? This also applies to many car dealers or so called financial brokers who advertise No Credit, No Problem Car loans. Once again you’re dealing with someone who has limited experience in consumer credit and once again they will submit your information to the credit lenders they think will possibly approve your application and hope for the best! What they don’t tell you is when they submit your information to all the financial institutions each institution does an individual credit enquiry on your credit bureau! This can create problems for you in the future if you didn’t get approved for a car loan as now you have a list of financial institutions that have checked your credit information and loans. As you have been turned down by one car dealer or financial Broker you think ok I will just keep trying until I get someone to approve me! Again every time you apply for credit a financial institution will make an enquiry on your credit file. Within days you might have 5-10 financial institution enquire on your credit bureau. This now creates a negative for you as when once again apply for credit a financial institution will again check your file and see all these Banks who have checked your file and none of them have approved you for credit? As a credit lender they will assess that the other Banks wouldn’t give you credit for what ever reason so why should they? Auto Source Financial approaches your credit from a lenders point of view assessing your credit file prior to allowing any financial lender to check your credit. With 25 years of Consumer lending experience our financial advisors have they knowledge of how to approve for a New Car loan. We will help you understand the credit reporting system in Canada and teach you step by step on how to get or fix your credit in Canada. Yes Auto Source Financial can get you the credit you’re seeking and get you driving a new car within days of your application. We will assist you on obtaining a credit card with an established bank in Canada and get you on the road to perfect credit. ASF is dedicated to assuring you get credit in Canada.

Auto Source Financial has worked with Financial Institutions like TD Canada Trust and Scotia Bank to provide its customers with a loyalty program. This program is designed to help people who have had past credit problems and wish to secure a vehicle loan. Due to the high risk of lending people with bad credit the program is based on your ability of repayment.

You will be granted a conditional loan to purchase a New or Used vehicle at a higher than average interest rate, this rate is based on your income, job stability, past credit issues and the age of the Vehicle you wish to purchase. Upon completing 10 months of payments on time without any reminders you will be granted a guaranteed approval for a New Vehicle loan for 8.9% interest.(Which is the Prime Rate for Good Credit Customers)

To take advantage of this offer you will have to trade your existing vehicle in on a New Model Year Vehicle.

Example: 

Your initial purchase is a 2005 Honda Civic LX Sedan for $15,000.00 Plus Taxes

Based on Booking Chart your payment would be $480.00 per month @ 24.50 %

After 10 Months you trade the vehicle back in to Auto Source Financial and Get a Brand New Vehicle. If you have maintained your Vehicle Auto Source will give you what you paid for it against your new Vehicle.

You drive away in a 2009 Honda Civic LX Sedan 24,890 Plus Taxes

Based on Booking Chart your payment would be $480.00 per month @ 8.90 %

“ Your payment doesn’t change but your Interest Rate and Vehicle Will ”

The best way of taking advantage of this program is to find a vehicle you like that when trade in will give you the same monthly payment on your New Vehicle. Try to be realistic about the amount you can truly afford per month as your payment will reflect the amount you can borrow and the type of vehicle you can purchase.

Remember Auto Source Financials advisors are trained in all types of credit issues and will work directly with you to get the vehicle loan that best suits your needs. As part of their service Auto Source will consult you for free on your existing credit and how to bring your credit score and rating back to an A1 rating.

For more information about Car Leasing for New Immigrants or Foreign Students in Canada visit www.autosourcefinancial.com. Auto Source specializes in all makes leasing and Car, Truck and SUV loans for people with No Credit, Bad Credit in Canada.

One of the most common questions I get from clients is on the subject of buying or leasing their next car. The simple answer is “it depends”.

From an income tax perspective, if you are eligible to deduct automobile expenses from either your business or employment income the deductions available over time are the same.

What you spend on the cost of your car is deducted at a rate decided upon by the Canada Revenue Agency (CRA). The deduction is called Capital Cost Allowance or you may know it better as depreciation. So long as you purchase a car, new or used, for $30,000 or less before PST and GST, you can deduct 15% of the cost in the year you buy the car and 30% of the declining balance for every year after that. Based on this formula, eventually, you will claim 100% of the cost of your car. If you purchase a car for more than $30,000 you will not be able to make a claim on any excess amount paid. However, if you have a loan on the car purchased, you will be eligible to deduct the interest paid on the loan to a maximum of $300 per month of interest charges.

If you lease your car, you are able to deduct the monthly lease payments so long as they do not exceed $800 per month plus PST and GST. In rare cases it may be lower but in general, CRA sets the limits ensure that the level of deductions for leased automobiles is similar to that for purchased ones. The detriment in a lease is that the initial down payment many people make, or are required to make, is not deductible at all for this calculation.

The above being the case, the benefit of one over the other hinges on the timing of your purchase, the type of car owner you are or would like to be, and your overall financial circumstances.

The timing of the purchase is important, as a purchase on December 31 of a year will result in the same deduction available as a purchase on January 1 of the same year. On the other hand, a lease entered into earlier in the year will result in more months of payments and thus a higher deduction for the year versus a lease entered into in December will result in no deduction as no payments have been made on the lease for the year.

The type of car owner that you are is important because you may be a person who drives few kilometres in a year and enjoys driving a new car. Why not then lease a car and in effect rent a new car all the time! However, if you drive a car until it’s dead, you should always buy your car as your cost of leasing will far outweigh your borrowing costs in the long run. Let’s take the example of a car that costs you $500 per month on a lease, no down payment and a buy out after 3 years of $10,000. If you can buy this same car for $25,000 with 0% financing, you would save yourself $3,000 and that is assuming, you don’t drive over the allowable kilometres in the year and have the $10,000 sitting in the bank in 3 years!

Finally, you’re over all financial circumstances may dictate what you should do. Using the above example, if your 0% financing is only for 3 years, your monthly payments would be $694 per month. If you do not have the extra $194 to spend on a car payment, then your only option is to lease.

Now that you know if you should buy or lease your car and what portion of those costs you can use for your deduction calculation, keep in mind that the final tax write off will be limited to the business use of the vehicle versus the personal use. If you use your car 80% of the time for business, only 80% of your monthly lease payments or your annual depreciation plus interest is deductible for tax purposes

For more information about Car Leasing for New Immigrants or Foreign Students in Canada visit www.autosourcefinancial.com. Auto Source specializes in all make leasing and Car, Truck and SUV loans for people with No Credit, Bad Credit too!

After you have been discharged from bankruptcy or completed your proposal, you may be a good credit risk, since you have no debt. Naturally, you will find it a little harder to get credit until you can re-establish a good credit rating.  

You can get credit again after a bankruptcy or a proposal. The bankruptcy and proposal laws of Canada are intended to give you a fresh financial start. The ability to rebuild credit is part of that new start.

Tips on Rebuilding your Credit Rating:

When a person declares bankruptcy the Office of the Superintendent of Bankruptcy notifies the credit bureau. This information stays on your credit bureau report for 6 years after the date of your discharge. A proposal stays on your credit bureau report for 3 years after your proposal was completed. You can start to re-establish your credit by doing the following:

Talk to your banker and say you want to re-establish your credit rating;

Open a savings account;

Be a regular and persistent saver.  Use the common techniques I am sure you have heard of: 

1) Pay yourself first; 

2) Take your next raise and save it; 

3) Save 5 % of your pay; 

4) Have your savings come right off your pay and into a separate savings account;

Take out a small loan using the savings account as collateral, and then pay it back;

Using a secured credit card is a quick way to rebuild your credit rating. For example, Horizon Plus reports your payment history to the credit bureaus each month. As you make regular payments your credit history looks better and better. You are virtually guaranteed that you will receive a secured credit card from Horizon Plus.

Pay your credit card balances on time.

After Bankruptcy Lenders:

The following lenders will give serious consideration to your loan application, knowing you have completed bankruptcy or a proposal:

Secured Credit Cards:

Car Loans;

Question: How can I build good credit in Canada? What steps should I take to get started? I just started a new job and want to start right.

Answer: One of the easiest, most effective ways to start building a credit history is to get a Canadian credit card. If you do not have a credit history, you may benefit from a secured credit card. With these types of cards, you decide how much credit you think you’ll need or can afford, and then deposit that amount with the bank as security. This amount becomes your credit limit.

For most people, all you need to do is bring some personal information and identification into a bank branch, where a bank representative can get you started on your credit card application.
Auto Source Financial can assist you in obtaining new Credit in Canada and direct you on how to build a perfect credit rating without a social insurance number.

Depending on the type of card you choose, you can earn rewards points that you can redeem for merchandise and you can include a co-applicant who will also receive a card for your account.

The only difference is that, with a secured card, you decide how much credit you think you’ll need and then deposit that amount as security.  For example, a $1,000 security pledge would give you a credit limit on your card of $1,000. This is a great way to start as it does not require a prior credit history.

The money you deposit as part of your security pledge is placed in a Guaranteed Investment Certificate (GIC). It will earn interest and grow while you build a credit history. Once your credit rating is established (which can take up to 18 months), your GIC security will be released from your credit card account.  

There are benefits to having a credit card so you should consider whether getting a credit card may be appropriate for you. It will help you establish your own credit history and help put you in a good position for the future. In addition, always make sure you pay your bills – on time and in full – as this also affects your credit rating.  

Auto Source Financial also can help you obtain a New Vehicle loan in Canada, as an immigrant most banks will not lend you the money to purchase a New Vehicle. Auto Source Financial can give you a New Car Loan with low interest rate.

Doug and Sue are faced with a financial crisis and are determined to do what ever it takes to gain control over their debts.

They want to pay their creditors and are in my office exploring their financial options. The couple has heard of a program called Orderly Payment of Debts (OPD) and want to know how it can be of help to them.

Unfortunately, the OPD program has become a victim of B.C. government cuts.The OPD program has provided more debtors with unbiased financial information than any other financial service to date. The program’s closure will cast thousands of poor individuals and vulnerable families to the yellow pages.

These people will soon be phoning trustees or credit counsellors, only to find that there is little in the way of services available to them.

OPD has been in existence since the late 1960s. In 1975, as a loans officer at Vancouver City Savings Credit Union, I made what would be the first of many referrals to the counsellors at OPD. For a period of 16 years, the OPD program was essentially the only credit-counselling service available to debtors.

As the national consumer debt expanded from $41 billion in 1980 to over $100 billion in 1990, B.C. could not keep up with the demand for alternatives to bankruptcy. Private-sector credit counselling services began appearing and have worked alongside the OPD program ever since. With the changes to the Bankruptcy and Insolvency Act in 1992, the Trustees in Bankruptcy began offering consumer proposals for debtors.

There have been growing pains with private-sector competition in the industry, as well as the occasional belief that the OPD program was “stealing business” away from both trustees and credit-counselling companies. However, there is no financial profit to be found in OPD’s activities.

In the beginning, OPD offered a service to the over-committed debtor where the program received little or zero profit. In recent years OPD has responded to newer casualties of the credit society — such as the student loan crisis, leaky condos and growing tax liabilities for individuals and families.

Once again, there is little financial profit to be uncovered.

In 1998, the OPD program split away from the consumer portfolio and the regulatory function of debt collection and credit reporting. OPD began to focus on separating families and providing mediation and counselling services at no cost to the debtor, creditor, or the family court. This initiative served to place the OPD program even farther away from the insolvency business and in the heart of another great social tragedy, the struggling family unit.

Once again, there is little, if any money to be made here.

With the closure of the OPD program, our industry will quickly discover how many free services were available in the past to people who are financially challenged.

Often people with severe financial problems are afraid and angry, and at times they can be belligerent. Starting April 30, there is no longer a destination to refer these unfortunate people to.

What is the cost of closing the OPD program?
The closure of the OPD program will increase credit counsellor’s costs, as many people turn to us for financial guidance and support.

Secondly, credit counsellors will lack a long-standing valuable resource, where, if all else failed, they could always send clients down to OPD.

Thirdly, there will be an increase in bankruptcy assignments for the poor and financially vulnerable. Possibly in the future, there may even be a need to create a new type of bankruptcy assignment to accommodate those who lack the ability to pay the bankruptcy fees.

Ministry statistics over the years have clearly established that the vast majority of clients for the OPD program need access to credit information. This information includes what constitutes harassment under the Debt Collection Act, what constitutes a proper and improper seizure of assets, what credit ratings are and how long will it affect the debtor, and many more questions and issues.

The OPD program has always provided the consumer with a great deal of information regarding bankruptcy itself, that will now undoubtedly come to credit counsellors and bankruptcy trustees.

Yes there may be new opportunities, but by and large, OPD has been a unique and special service in BC.

I am not alone as I mourn the death of the OPD in B.C. On behalf of the hundreds of clients I have referred to OPD over the last 27 years, I wish to extend a special thank you to Mr. Doug Welbanks, director of the Debtors Assistance Program and his excellent staff – you will be missed.

Margaret H. Johnson ACE, RQIC, has over 35 years of financial industry experience in both lending and collecting. She is an Accredited Insolvency Counsellor, Registered by Industry Canada

Think that because you’ve had a bankruptcy that you can’t get a car loan? Think again! There is no need to be embarrassed, everyone makes mistakes. Often people go through hard times such as divorce/separation, illness and loss of income making it very difficult to pay back debts on time and acquire a car loan.

Here are some tips that will help you while trying to rebuild your credit with a car loan after a bankruptcy:

•Review your current finances and know what you can afford before applying for a bad credit car loan. Look at your finances and decide what you can afford for monthly payments.                                                            

•Review your credit report

• If you find incorrect information or accounts that should be closed make sure that these details are taken care of before you apply for your bad credit car loan. •Interest rates may not appear low, however keep in mind that most loans if paid regularly on schedule can be refinanced after one year giving you a lower interest rate for your car loan.

•Car loan applications will often ask if and why you have declared bankruptcy. Make sure to explain your financial situation when prompted and to include why the bankruptcy occurred as well as what you have done to clear up your credit situation.

•Try to find a reputable car loans specialist that will find you the best loan possible. Some businesses may try to take advantage of the fact that you have been through a bankruptcy. By using our bad credit car loans application you will avoid being taken advantage of.

What is important is beginning to rebuild your credit as soon as possible. We want to help you rebuild your credit after a bankruptcy and what better way to do this than with a car loan?

By focusing on your current credit situation instead of your past, Auto Source Finance has numerous different lenders, allowing us to get you the best interest rate for your car loan. We have given over $5 million dollars in bad credit car loans and provide the best interest available.