Guaranteed Auto Loans
Guaranteed auto loans provide a last-chance option for those who have been declined by traditional finance sources. Most guaranteed auto loans are offered online by services like Rapid Car Loans, but credit unions and local lenders can sometimes have very few requirements for approval, so it may be worthwhile to check with local lenders as well.
As guaranteed auto loans are directed at individuals with some bumps in their credit histories, a down payment will normally be required, and you may also be required to pay a sizable bank fee to complete the transaction. You will also find that interest rates on guaranteed loans are significantly higher than a traditional loan and can range all the way to 24.99% or the state maximum in your area. Guaranteed loans are also focused primarily on pre-owned vehicles, because the lower selling price ultimately helps lessen the lender's risk.
Guaranteed loans also have shorter repayment periods than traditional loans, with some terms as short as 24 months. Again, the term you are offered will be based on your personal credit history, amount you plan to put down and the selling price of the vehicle you plan to purchase.
Some guaranteed auto loan lenders will do a credit check and require up to six personal references, while others will not complete a credit check but may have higher rates and less favorable repayment terms.
And, yes, if a guaranteed auto loan sounds too good to be true, it probably is. A lending institution may still deny your application and deny financing for most any reason related to your credit history. If you feel uncomfortable with a lender, you can do the same thing they can: walk away from the loan and find a different or better one.