Can you still get a subprime car loan in Ontario?
Can you still get a subprime car loan in Ontario?
Posted on August 18, 2022
With the Canadian economy on the verge of recession, you may be wondering if it is still possible to get a subprime car loan in Ontario.
The short answer is “yes,” but you should consider working on your credit instead of taking the subprime route.
Our Dunnville car loans team will show you how to get the best possible deal on a new car loan without putting yourself into massive debt. Stick with us until the end of this conversation!
Interest rates are climbing fast
The Bank of Canada has already implemented a series of significant interest rate hikes and will continue to do so throughout 2022 and well into 2023.
Each time interest rates go up; it makes it harder for all lenders to secure financing. Even borrowers with great credit are forced to pay more just to access the capital they need.
If you are a subprime borrower, you will be paying the absolute maximum by law which is why you need to start working on your financial situation today.
Credit scores and auto loan underwriting: what you need to know
Your credit score dictates whether you qualify as prime or subprime; in Canada, the average credit score is in the 650 range, but to access the best financing terms, your credit score must exceed 720.
If your credit score is 600 or lower, you need to start working on improving that score.
Don’t worry; the steps to raising a credit score are simple and effective.
- Sign up for free credit monitoring with both TransUnion and Equifax, so you will know your current credit score. This is establishing a baseline for you to work from and track your progress.
- Look inside your credit report for any errors that could put downward pressure on your credit score. If your credit report does have errors inside of it, you need to file a dispute to have those errors removed.
- If you have any accounts that are past due or almost in collections, prioritize bringing those up to date as soon as possible. The sooner these accounts are made current, the higher your credit score will go.
- Reduce the total amount of debt you are servicing; this can be challenging, especially with inflation at historically high levels but the less debt you are carrying, the higher your credit score, plus you save money on costly interest.
The best place to go for a car loan in Dunnville
If you need a car right away, regardless if you have prime or subprime credit, you should work with a local Ontario car dealership.
These local dealerships have credit experts that can assess your situation and find a lender that is willing to give you a good deal.
These local dealerships take their time to get to know you and your situation, which is something you cannot find online.
Now that you have a better understanding of how to improve your credit, so you don’t have to go through a subprime car loan, contact your local Ontario dealership today.
Contact Unique Chrysler for help, advice and competitive Dunnville pe car finance and leasing.
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