Your House Can Help You Buy Your Dream Car

In the past, people would save money when they wanted to buy a car. Now the times have changed. There is no need to have savings to buy a car. There are several ways of driving home your dream car.
One of the ways is to get a car on a lease. In this case, you can have a car but do not own it. For this service, you give monthly lease rentals to the car dealer. This is ideal for those who cannot afford to buy a car. You can buy a car either on hire purchase or on a car loan. In case of hire purchase, you can drive home a new car and keep paying monthly installments to the car dealer subsequently. Alternatively, you can take out a car loan from a lender to buy a car and then repay the loan in the form of monthly installments.
All this is fine. The problem arises when you have a bad credit history. You acquire a bad credit history when you default on loan repayment. Late payment also has a negative impact on the credit score. Bankruptcy also leads to a bad credit score. You should be very careful when you apply for a loan because if your loan application gets rejected, your credit score gets a thrashing. Once you acquire a poor credit score, it becomes very difficult to obtain a bad credit loan.
It is wrong to say that people cannot get bad credit car loans. There are many lenders in the UK who offer such loans. There is a big market for bad credit car loans in the UK. However, offering a bad credit car loan is risky for lenders. The lender would like to make sure that the borrower would repay the loan. Because of this, lenders prefer secured loans to unsecured loans. A secured loan is backed by a security which reduces the lender’s risk. In case of a default, he can sell off the property put up as a security to recover his money. Homeowners can use their house to obtain a bad credit car loan. Lenders willingly accept such a security since the value of a house does not go down. Moreover, it helps the borrower to release the equity that is tied up in his house.
About the Author: The author is a business writer specializing in finance and credit products and has written authoritative articles on the finance industry. He has done his masters in Business Administration and is currently assisting Bad Credit Auto Loan as a finance specialist.For information please visit us http://www.bad-credit-auto-loan.co.uk/