I need to get a new car but banks keep turning me down for loans. What are my options?
You have a handful of options if your bank (or multiple banks) are not granting you loans for a car. Some of these choices may be more or less appealing depending on your situation.
One approach would be to visit a credit union. Credit unions offer similar services to banks, but sometimes offer more attractive loan terms and interest rates.
Another option would be to look at cars which are less expensive. If you’re being turned down for a loan for a new car (or relatively new car) then you might be better off in the short term going on-line and seeking lower-cost used cars.
Car dealerships typically offer financing options. These payment plans often aren’t as attractive as what you can get through a bank, but since the bank isn’t working with you, striking an agreement with the dealership might be your best option.
You can also try your luck with peer-to-peer lending. I’ll be talking about this more in another post, but peer-to-peer lending is basically a service where individual people (rather than banks) will lend you money for a medium-length term (typically three to five years). In Canada you can check out goPeer to try to get approved for a peer-to-peer loan. In the USA the equivalent service is called Prosper.
Do you have a line of credit? If you do then you can use the line of credit to pay for a used car. Some banks might offer you a small line of credit you can borrow from even if they won’t grant you a car loan.
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