FAQ. Bad Credit Car Loans.

How much does it cost to apply ?
It is Free and no obligation.

How does it work?
Apply Online (or Call Us). We will call you back today to discuss the vehicle you want and your desired monthly payment.

How much will my monthly payments be?
Most car loan payments range from $250.00 to $350.00 per month.

How much down payment do I need?
We offer Zero down payment. Many customers have $500.00 for down payment. With a down payment your monthly payments will be less.

Can I use my current vehicle as a down payment?
Yes, we accept trade-ins as down payment.

What about car insurance?
Insurance is required on all financed vehicles, Full Coverage. We can help get you a fast, free no-obligation insurance quote and a good price.

What about a used car warranty?
A warranty is always recommended. We provide by Coast to Coast, one of Canada`s premier warranty companies. Your warranty can be added to your car loan payments.

We recommend Coast To Coast and Lubrico Warranty.

Posted in Bad Credit Car Loan, FAQ

How to Get a Bad Credit Car Loan in Toronto, Ontario.

Bad Credit Car Loans

Getting a bad credit car loan in Toronto or anywhere in Ontario is easy. Most financing companies offer online applications. A few companies even offer same-day pre-approval. Here are 6 easy steps on how to get a bad credit car loan in Toronto or anywhere in Ontario.

  1. Find a reputable car dealer in Ontario who specializes in bad credit, ensure they are listed with OMVIC, the Ontario Motor Industry Council and UCDA, the Used Car Dealer’s Association of Ontario.
  2. Apply with only one company, if possible. When you apply for a loan there is an inquiry on your credit report, applying for credit repeatedly looks bad on credit history.
  3. Find a car dealer who is connected to several car financing companies, they are more likely to get you approved and there are fewer inquiries on your credit report, they pre-qualify loan applicants to a suitable lender in their network.
  4. Find a car dealer financing division with experience. Approval for difficult credit situations is more likely with companies who have been in the car financing business for a while.
  5. Find a car financing division who deals with companies that report to the credit bureau. This allows you to repair your credit in just 6 months.
  6. Apply online. Be prepared to provide a copy of your valid Ontario driver’s license and proof of income.

If you need a car loan with no credit check, or,
if you are unable to prove your income, an option is a buy-here-pay-here-loan with a local used car dealer. A car loan with a financing company requires proof of income. Beware of buy-here-pay-here-loans, cars can be in poor condition. Use our Used Car Buying Vehicle Checklist to assess the car you wish to buy.

If you are looking for a bad credit car loan we can help. We are connected to a network of lenders and we specialize in car loans for bad credit, no credit, or bankruptcy. We are United Auto Credit, financing division of Auto Resale car dealership in Toronto. We can get you a bad credit car loan in Toronto or anywhere across Ontario today.

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Is Borrowing Money Good or Bad for my Credit?

How does borrowing money affect my credit?

Borrowing money in itself is neutral – it can work in your favour or against you depending on how you handle paying back your creditors. If you stay on top of payments, especially larger ones, it shows an individual can handle credit responsibly. This will result in good credit history and a good credit score which will result in better interest rates for you.

Borrowing money is good for you if you pay your bills on time.
Borrowing money is bad for you if you fail to pay your bills.

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Credit History. What it is, How it affects Car Loan Interest Rates.

Credit history determines interest rates and if you can get a loan at all, it  provides insight about your financial health and financial responsibility. Your credit history, rating, and score provide insight on how likely you are to pay a lender on time. Lenders use categories based on credit history to rate applicants as high, medium or low risk to repay.

Credit Rating – an evaluation of a person’s credit history in Canada. It is based on variables such as credit card payment history, monthly mortgage payments and anything with a payment schedule, such as utilities like electricity, water and heating.

Credit Score - a three digit number that represents credit rating – it determines if you are low, medium, or high risk. It is calculated on an algorithm that compares your credit information to credit information of other people. It is a prediction of how likely you are to pay your lenders on time.

Medium or high risk credit scores are often refused by regular banks.

Good credit – banks are are viable lenders. “Banks have stepped up to provide car-loan business as the credit arms of some major car makers have stopped leasing vehicles and been forced to charge more for loans,” as Automotive Consultant Dennis DesRosiers tells it.

Bad credit, bankruptcy, or no credit – local lending institutions and private lenders are suitable options. They offer car loans focused on the ability to repay. At United Auto Credit we offer car loan options for people with any credit rating across Ontario.

Pay attention to your credit score if you want good interest rates on a car loan. Make at least the minimum payment on your bills to show financial responsibility, this will affect your credit positively.

Make regular payments for just 6 months and repair your credit - then get a new loan with a better interest rate. The new loan can be used to pay-off the previous loan with the higher interest rate. You save the money you would have paid in high interest rates.

If you purchase a car on credit and fail to make monthly payments then the car can be repossessed. Also, it will make it difficult to get a loan in the future, you will be high risk for lenders.

United Auto Credit, we can help you get a car loan, Ontario bad credit car loan specialists with over 20 years experience.

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Buying a Used Car. What to look for, with Inspection Checklist.

Used Car Inspection Checklist

  1. Inspect the car in daylight.
  2. Inspect the interior, brake and accelerator pedals. Recent replacements can indicate wear & tear.
  3. Examine the outside of the car closely. Waves on the car’s body can mean bodywork or accidents.
  4. If the car has had accidents, ask for an accident history report. A private seller must provide a ‘Used Vehicle Information Package.’
  5. Purchasing from a car dealer, request a Car Proof Vehicle History Report, a reputable dealer will provide it no questions asked. You can also order Car Proof online; you will need the VIN, Vehicle Identification Number. Cost ranges from $9.95 to $29.95.
  6. Take the car for a test drive, at different speeds, on different surfaces.
  7. Have a mechanic do a full check-up and run diagnostics.

Buyer Beware, luxury imports are not immune to wear and tear. “Even a well-made vehicle deteriorates if it is not properly maintained,” says the Ontario Ministry of Transportation.

Warning Signs for Problems and Repairs.

  1. Steering – if the steering pulls to one side it can mean the alignment has problems.
  2. Brakes – squealing brakes can mean they are worn down and need replacing, that they are improperly adjusted, or that they are a bit too large, like many aftermarket products, but this will burn off in a day or two.
  3. Smoke – blue smoke from the tailpipe can mean expensive engine repairs.
  4. Control – a lack of control when turning can mean the steering linkage has problems or worn-out shock absorbers.
  5. Odometer Reading – if the odometer shows low kilometers for the car’s age it can mean it was tampered with. Odometer tampering is a criminal offence and should be reported to the police. Drivers average 16,000 to 20,000 kilometers annually.
  6. For more information, read the MTO’s used car buyer’s checklist.

Get a Personal Property Security Act Search

  • In Canada, the Personal Property Security Act Search, PPSA, shows if car has a lien or claim against it; if a used car seller, or former owner still has obligations attached to a car or if an outstanding loan remains. A list of Ontario third party providers who offer a Personal Property Security Registration for a low cost.
  • If a loan has been repaid, insist a “Loan Discharge” be provided and “Registered” by the seller.
  • If a loan has not been repaid, buyer beware. The Ontario Ministry of Small Business and Consumer Services states “If a lender has rights in the used car and a search is not done, the car could later be seized if the borrower fails to repay the loan. Consumers do not need to search when buying a used car from a registered motor vehicle dealer in Ontario unless the car is worth more than $15,000.

More on Ontario Used Car Buying

Buying a used car is a smart purchase and makes good fiscal sense. The Ontario used car business has cleaned up as a result of stricter laws and regulations. Used car buyers can make informed choices. The Auto Trader.ca offers information on used vehicles; what to look for in a previously owned car, what used vehicles are worth, their availability in your area, where to find a dealer etc. Car Proof, Vehicle History Report is an excellent resource available from your car dealership, also available online for minimal cost. Ontario “Used Vehicle Information Package” provides the buyer with a vehicle’s history. It is mandatory for Private Buyers and Sellers of Vehicles in Ontario,

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Find a Reputable Car Dealer in Ontario, easy checklist.

The Ontario auto trade industry has regulatory bodies to identify reputable car dealers. Look for the UCDA and OMVIC logos and verify if a dealer is registered with UCDA on their web-site.

The Used Car Dealers Association of Ontario, UCDA,

  • UCDA is the licensing body for auto dealers in Ontario.
  • Their mission is to improve the reputation of the used vehicle industry in Ontario.
  • All Ontario registered car dealers are listed by name and city on the UCDA web-site. Research your auto dealer so you are not taken advantage of by a curbsider who sells cars illegally off the curb of the road.

The Ontario Motor Vehicle Industry Council, OMVIC

  • OMVIC oversees adherence to the Ontario Motor Vehicles Act.
  • Complaints regarding problems with a recently purchased vehicle from a registered car dealer can be directed to OMVIC. They will launch an investigation into the issue.
  • OMVIC can only help if the vehicle was purchased from a registered Ontario auto dealer. If the vehicle was purchased from a curbsider you must go to the police.
  • Do not try to lie to OMVIC to get out of your car loan, they have access to your financial dealings and uncover lies quickly.
  • If you wish to get out of a car loan, we have experience dealing with all sorts of difficult situations. Call us, we are likely to be able to help you.
  • OMVIC will, however, help you get compensation if you were cheated and they are reliable in doing so.

Auto dealers who are members of these organizations are held to a higher standard and as such are accountable. To ensure you are dealing with a legitimate car dealer, don’t forget to check UCDA.

Furthermore, the certification body for the automotive industry in Canada is the Canadian Automotive Institute. Its main purpose is to uphold the highest standards of integrity and accountability in the automotive trade.

United Auto Credit is registered with UCDA, you can find us on their web-site We are the financing division Auto Resale car dealership who can be found on the OMVIC web-site. We are Ontario’s bad credit car loan specialists for Toronto, the GTA, Mississauga, Barrie, and all of Ontario.

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Car Proof vehicle history report. What is it, Where, and How to get it.

Whether financing a car loan or buying a used car, Car Proof vehicle history report is a helpful resource available online or from your car dealer.

Car Proof is Canada’s leading provider of comprehensive vehicle history reports to consumers, car dealers, provincial governments, and vehicle manufacturers. A number of companies provide vehicle lien and history searches, the Trillium Automobile Dealers Association of Ontario endorses Car Proof as the most comprehensive accident and lien reports available in Canada.

Car Proof can be purchased by anyone

Instant Car Proof vehicle history reports are available online for a small cost, or from your car dealer free of charge. You will need the Vehicle Identification Number (VIN). Cost ranges from $ 9.95 to $ 29.95. Go to www.carproof.com, click on “Order Report.” Enter the VIN and payment information and instantly receive a vehicle history report or screening product by email.

Car Proof vehicle history reports include

  1. Current information about Canadian used vehicles and their history
  2. Canadian (and sometimes U.S.) lien and/or security information on used vehicles
  3. Canadian insurance and accident claims data on used vehicles

Car Proof offers three main reports

1.) Claims  2.) Verified and  3.) Verified BC.
Additionally, you can order a screening tool to screen vehicles 10 years old and older for damage. Car Proof searches over 100 data sources for each report, provides fully bilingual, real-time data including critical accident data, registration and branding info, full U.S. history (if applicable) and cross-Canada lien and/or security interest information in their “Verified” reports.

Ontario has a mandatory vehicle “branding” program

Since 2003 the Ontario government has a mandatory vehicle “branding” program to indicate whether a vehicle has been severely damaged in the past – it requires that “insurance companies, auto recyclers, salvagers, auctioneers, dealers and individual vehicle owners must assign a brand type to vehicles that have been damaged to the point of total loss and meet this branding criteria.” The four brand types are irreparable, salvage, rebuilt or none.

Car Proof was founded in 2000

Car Proof was founded in 2000 by Paul Antony and partners. Antony, an Ontario car dealer, after purchasing vehicles from outside the province discovered the vehicles had liens. Back then no service existed for Canada-wide lien searches. Although Province-wide lien searches were available they did not include other provinces or the U.S. Recognizing the need for transparency and communication for pre-owned vehicles in Canada, Antony founded CarProof.

At United Auto Credit we include Car Proof vehicle history reports with our vehicles. We are Ontario’s bad credit car loan specialists. Over 20 years experience dealing with difficult credit situations, we offer guaranteed approval* and same-day pre-approved auto loans.

source: Toronto Star, Wheels.ca, July 20, 2012, Dealer’s Voice: Internet useful tool in used car research.

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Information Ontario Car Dealers must provide to Buyers, easy checklist.

In Ontario, by law a car dealer must provide the buyer with

  1. The make, model, and year of the vehicle.
  2. Whether the vehicle is “branded.” If the vehicle was damaged and irreparable, or, partially damaged and deemed salvageable.
  3. If the vehicle was previously used as a limousine, police cruiser, emergency services vehicle, taxi or other public sector usage.
  4. If the vehicle was used as a rental vehicle.
  5. The accurate mileage of the automobile.
  6. Provide a CarProof vehicle history report.

Failure to provide this information should raise suspicions about the dealer in question. In Ontario, failure to answer these questions honestly constitutes legal grounds for termination of a trade-in or purchase contract.

You can request referrals or check the legitimacy of reputable car dealers at The Used Car Dealer’s Association of Ontario, UCDA.

At United Auto Credit we gladly provide this information. We are Ontario’s bad credit car loan specialists.

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How to Repair your Credit in just 6 months, easy checklist.

To repair your credit fast just show financial responsibility for 6 months and your credit score will improve significantly:

  • Pay your bills on time or make at least the minimum payments on your credit cards and loans each month.
  • Keep your oldest accounts open. Longevity looks good on a credit report.
  • Don’t use more than 30 percent of the credit you have available to you.
  • Don’t open new accounts all at once. That looks risky.
  • Keep your bank records clean. An insufficient funds problem will show up on your report.
  • Diversify. Having a variety of loans, such as a mortgage or car loan, that you pay on time each month helps your score.
  • Pay off your balances. Don’t keep transferring your balance. If you can’t pay your bills, contact your creditors to work out a payment plan or see a credit counselor.
  • Beware of credit counselling! These are businesses and as such are here to make money. Generally speaking, credit is something you can repair on your own. Payment arrangements are something you can easily make with the companies you owe. Talk to them before your account is sent to collections. Do not let it get this far!
  • Collections reflect poorly on credit history. Talk to your creditors to make payment arrangements. Any company will let you pay off a debt even at $10 per month. They would rather have their money back than sell it to a collection agency where they only get a few cents on each dollar you owe.
  • With a payment arrangements your credit is affected much better than it would be if you default on your payments and get sent to collections.

If you find yourself with less than perfect credit and need a car loan, contact us today.

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What to do if you Owe More on a Car than its Value.

If you owe more on your car than it is worth it is called to be “upside down” on your car loan. The value of the car is less than the amount left to pay-off on the loan. Many people are “upside down” on their car loan due to the economy and auto industry.

It is wise to refinance a car loan with the best interest rate you can find. This keeps payments low and prevents an “upside down” situation in the future.

Consumer advocates recommend financing cars for up to five years or less and buying cars that hold their value better. It is also a good idea to make some down payment.

The best way to keep money in your wallet is to buy a cheaper, good used car and keep it longer. This helps prevent going “upside down” and helps build good credit history.

How did so many people wind up owing more than their car is worth?

Many people bought into extended car financing; some as long as five and six year loans where balances are paid-off slowly. Also, often down payments were not required thereby making payments higher; and each of these payments also includes interest on the payment. As a result people are paying more than their car is worth after that time depreciation.

According to Experian Automotive, the average car loan is still nearly five years and $19,000 at an average rate of 8.37%.

If you are upside-down on your car loan or need a bad credit car loan we can help.

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