Car Loans on ODSP or with a Disability: How to Get Approved
Car Loans on ODSP or with a Disability: How to Get Approved
Posted on October 21, 2022
Getting a car loan can be tough at the best of times, but when you’re reliant on ODSP (Ontario Disability Support Program) payments it can be even more so. It’s possible to get a car loan no matter what your financial situation is, it’s just a matter of where you’re looking and what standard you’re trying to reach.
Short Term Solution
Because of your financial situation, most creditors are likely going to consider you a risky investment, as statistically the chances of you defaulting on the loan are higher than average, there are two ways you can approach solving this problem, short term or long term.
Starting with the short term there are a couple of things that you can do to secure car loans on ODSP or with a disability.
1) Find a lender that specializes in low income loans. With a loan designed specifically for your situation you have a much higher chance of approval, however the trade off will be a higher interest rate and a much longer term to pay it off in. You can easily get approved for a low income car loan with Car Nation Canada.
2) Find a co-signer. A cosigner is generally a family member who signs the loan alongside you and takes on the risk. If you default on the loan then the debt will fall to them instead. It requires a lot of trust between signers but it can secure a loan that you may otherwise not be qualified for.
Long Term Solution
If you have time to work on this and don’t need a car loan right away, then what you can do is counter your low income situation with a fantastic credit score. If you have a low income, but you have an excellent credit history that shows reliability despite that, then you can qualify for a car loan while on ODSP or with a disability in that your financial situation normally wouldn’t allow.
The best ways to increase your credit score are:
● Pay off debt: Any current debt you have will be negatively affecting your credit score, pay off as much as you can, if the loan allows it make extra payments to pay it off faster
● Keep balances low: One of the most important numbers to your credit score is “credit utilisation” so the more credit you have access to but aren't using the better.
● Checking for errors: It’s worth getting a credit report and giving it a thorough once over. Errors can significantly affect your credit score and you want to get them cleared up ASAP.
● Paying on time: Even one late payment can negatively affect your credit score, so make sure no matter what, you're making those payments on time.
There's no reason you can’t combine the long and short term solutions, in fact doing both will maximize your chances of getting the best car loans on ODSP or with a disability.
Click here to get approved for your next car loan online today! we have a team of credit specialists ready to help you get approved for a great priced car loan, and will work with you no matter your credit score.