If you are in a consumer proposal and need a car you may feel like the deck is stacked against you. Many things you will read will tell you to wait until you have been discharged from the proposal before attempting to secure a car loan. This ensures you get the best possible rates and terms. However asking someone to go carless for eight years (5 for the proposal and 3 to have it drop off your credit report) simply isn’t practical for the majority of British Columbians. Many people have a pressing need for a reliable vehicle regardless of their financial circumstances. Everyone has jobs to get to, some that require a long commute. Let’s face it; many people live in areas where there is poor public transportation in BC. People have families and/or elderly parents they take care of which also means appointments with doctors, kids activities, etc. These things need to be tended to. It’s not always as easy or practical to “just take the bus” or asking for help from friends and family for many, many people out there. We will work with you to craft a realistic budget and find a practical vehicle that meets your immediate shorter term needs. We advise for many in this situation to look at slightly older cars with low mileage at a low cost so that the depreciation is minimal, and the payments are manageable.
As to how much you will get approved for, your income and your debt to service ratio will have a lot to do with that. The lenders we work with take into account your rent or mortgage payment, any outstanding credit payments, your consumer proposal and then they factor it against your gross income. This allows us see how much money is left over to allow for a car payment.
Also, our lenders look at vehicles by way of booking charts. Some models have a better book value than others and because of this will rate a higher loan amount. Major factors they consider are the age and KMs of the vehicle when making the decision. A newer model with lower mileage will qualify for a longer term, and therefore you can afford a higher priced car.
The way we do it at 360 Approved is we will take the application, review your credit file and your overall situation (the consumer profile). From there we will choose the most appropriate lender for the situation and get approval. While doing this, we select vehicles that fit the budget and loan criteria. After that, all you need to do is decide which vehicle you like the best.