Whether you’re looking for bad credit loans in Halifax or anywhere else in Nova Scotia, you have options. While traditional lenders may make it harder for you to qualify, subprime lenders are a viable option. Find out where you can apply for bad credit car loans in Nova Scotia and how to compare your loan offers in this guide.
Before applying for a subprime car loan, read over the eligibility criteria to make sure you meet the baseline requirements. They typically include the following:
The process for getting a bad credit car loan in Nova Scotia isn’t too different from getting one with good credit. Here’s a step-by-step look at what to expect:
Compare Nova Scotian lenders, their car loan rates, terms and their eligibility requirements. After this, create a shortlist of top contenders. Check on whether you can make extra payments without any penalties and if you have the option to refinance your loan without penalty.
Based on the eligibility criteria, prepare everything you need for a successful application. You may be asked for proof of identity (passport or driver’s licence), auto insurance and, most importantly, your income. Have copies of pay stubs, a letter of employment or tax returns ready for uploading.
When a lender in Nova Scotia pre-approves you for a car loan, it means they’ve qualified you in advance for an auto loan based on a light review of your finances. Once you’ve selected your top choices, apply online.
Consider the options you’ve been pre-approved for and decide on the offer you want to proceed with based on your budget and needs. To finalize approval, the lender will look at your documents to verify your identity and income.
Once you’ve received approval, read your loan contract with extra care. Note your APR, terms and your payment schedule. Make sure you agree with any charges you may incur for late or missed payments, early repayments and refinancing changes.
With your loan finalized, you’ll receive the funds to buy your car within 1-2 business days. Create a repayment plan, circle due dates on your calendar and make sure you stick to your loan’s terms and conditions.
Nova Scotians can finance nearly any vehicle they want with bad credit car loans, including cars, SUVs, vans and trucks. The only limitations to your vehicle choices will depend on how large a loan amount you’re approved for, which typically maxes out at $50,000 for bad credit car loans. However, it’s unlikely you’ll get approved for a car loan of this size unless you show the lender there’s plenty of room in your monthly income for the loan payments.
Consider focusing on used cars with cheap price tags to make your loan much more affordable. Learn more about used car financing.
With the right strategy, Nova Scotians can secure the funding you need even with bad credit. Consider these steps before applying:
Take account of these factors to help you find the best option to suit your needs:
From the interest rate to extra fees and penalties you may incur, your job is to zero in on the true cost of your auto loan. The annual percentage rate (APR) represents the annual cost of having the loan, including both interest and fees. This is one of the most crucial determining factors to help you compare loans.
Loan terms usually run between 12 - 96 months. Shorter loan terms will help you get out of debt faster, but your monthly payments will be larger. A longer loan term equals smaller monthly payments with more time to accrue interest. Choose a lender with loan terms that work for your budget and timeframe.
Bad credit car loans often come with more fees than other types of car loans. Check on whether your lender charges administration fees, origination fees (a processing fee) or other penalties such as late fees or NSF fees.
If you’re buying a used car, you may need a loan amount that’s less than the minimum some lenders offer. Make sure the loan amount you need fits within the lender’s parameters.
From a minimum credit score to a minimum monthly income, lenders in the bad credit space have specific eligibility criteria you must meet.
Find a bad credit car loan lender in Nova Scotia that allows you to make extra payments or pay off your loan early without penalties.
Some lenders and dealers allow you to trade in your current car for a new one or to use it for a down payment. If you have an old car that may be worth trading in, you could shift your focus to lenders that offer this option.
The cost of a bad credit car loan in Nova Scotia depends on a few factors:
For illustrative purposes, let’s say you live in Halifax and you’re looking to finance a used car. Here’s a glimpse of what your monthly payments could look like with a bad credit car loan compared to a conventional car loan.
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Your loan
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$
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| Interest rate |
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%
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or
Compare car loans now| Principal | $ |
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| Interest | $ |
| Total Cost | $ |
Don’t panic if you’re having trouble securing a car loan due to your bad credit. There are lenders providing subprime car loans in Nova Scotia. Shop around and compare factors, such as interest rates, loan terms, extra fees and repayment flexibility, before deciding on the choice that best suits your needs.
Ultimately, a bad credit car loan can be just the ticket to help you get the keys to your new car and aid in rebuilding your credit.
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