3 Ways To Protect Yourself From Predatory Auto Lending
Since the mortgage bubble burst in 2007, predatory lending for mortgages has been major news.
What we don’t know is that there are no laws passed to protect us from predatory auto lending.
It isn’t any news that auto dealers will shop around through different lenders to try to find us what we think is the best rate.
Did you know they also shop around to run your credit multiple times?
One of the latest predatory auto lending practices is to drop your credit score to bad credit by running your credit multiple times through multiple lenders.
The purpose for this is to prevent you from shopping somewhere else to get approved and to ensure that you will be paying a higher interest rate.
Sinister, evil and conniving!
There are 3 ways you can protect yourself from predatory auto lending so that you can avoid these predatory tactics.
- Know what your credit scores are before you shop for a car. The more you know about your own credit scores, the less harm these dealers can do to your credit. Don’t depend on them to tell you what your credit is.
- Find out what lenders are likely to approve you. You can do your own research and determine what auto lenders will be more likely to approve you based upon the qualifications they are looking for. This way, you can guide the sales person into the right position to finance you instead of relying solely on “what they will do for you.”
- Don’t choose bad credit dealerships. Avoiding dealerships that specialize in financing bad credit will cut out most dealerships who use predatory auto lending tactics. Many of these car dealerships have bad practices and you can avoid a potentially devastating situation by avoiding these dealerships altogether.
How does it make you feel to know that these tactics are being used?
I hope you enjoyed this article. If you have any questions about ways you can protect yourself from predatory auto lending, or have your own review of protections against predatory auto lending, leave a comment below.
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