Purchasing lawn care equipment like a lawn mower can be a significant expense, especially if money is tight. You may be tempted to finance a lawn mower if you need one but don’t have the cash on hand to pay for it upfront.
Financing allows you to get the lawn mower you need right away and pay for it over time. However, taking on debt to buy a depreciating asset like a lawn mower can be risky. Before deciding to finance, consider why you need a new lawn mower, whether you can realistically afford the payments, and if financing makes sense for your financial situation.
The goal of this guide is to walk through the key steps and considerations when financing a lawn mower with bad credit. We’ll look at alternative options, tips for improving your credit, budgeting for payments, and how to maintain good standing once you have the loan. With some careful planning, financing a lawn mower may be possible even with less-than-ideal credit.
Understand Your Credit Score
Knowing your current credit score and understanding what impacts it is important when seeking financing for a major purchase like a lawn mower. Your credit score is a number between 300 and 850 that lenders use to evaluate your creditworthiness.
Scores below 580 are generally considered poor or bad credit. The lower your credit score, the higher interest rates you’ll pay and the lower your chances of getting approved for financing. The most commonly used credit scores are calculated by FICO and VantageScore.
Some of the main factors that impact your credit score include:
- Payment history: Have you paid your bills on time? Late payments can significantly lower your score.
- Length of credit history: In general, the longer your credit history, the better.
- New credit: Opening several new accounts in a short period can lower your score.
- Credit mix: Having different types of credit (credit cards, loans, etc) can help your score.
- Credit utilization: These measures how much of your available credit you are using. High utilization rates can hurt your score.
Improving your credit score takes time, but steps like paying all bills on time, lowering credit utilization, and avoiding new credit inquiries can help. Checking your credit reports for errors and disputing inaccurate information can also boost your score.
Possible Financing Options
When looking to finance a lawn mower purchase with bad credit, you’ll want to explore and compare different financing options to find the best rates and terms for your situation. Here are some of the main options to consider:
1) Dealerships: Many lawn mower dealerships work with special financing companies to offer financing directly at the point of sale. This can be convenient, but interest rates are often higher than with a standard bank loan.
Be sure to ask about any specials they may be running for reduced interest rates. Dealerships typically only report your payments to the financing company, not the major credit bureaus, so this won’t help improve your credit score.
2) Banks: Banks provide lawn mower loans, often called “personal loans.” Interest rates will depend on your credit score. With bad credit, you’ll pay higher rates. Banks report loan payments to credit bureaus, so this can help improve your credit over time if you make consistent on-time payments. You may be able to get pre-approved for a loan before visiting dealers.
3) Online Lenders: There are many online lending companies that cater to people with bad credit. Interest rates may be high, but they provide more flexible qualifying requirements. You can easily compare rates and term options across multiple lenders. Payments with online loans will also be reported to the credit bureaus. Be sure to vet lenders carefully and watch out for predatory lending practices.
When comparing financing options, look at interest rates, origination fees, loan terms, monthly payments, and credit reporting practices. This will help you identify the most affordable option that also fits your budget and potentially helps build your credit back up over time.
Alternatives Financing Options
Before taking on financing for a new lawn mower, it’s worth exploring some alternative options that don’t require borrowing money or taking on debt. Here are a few possibilities to consider:
1) Buy Used: Purchasing a used lawn mower can save you a lot of money compared to buying new. Used mowers are often still in very good condition, especially if you opt for a late model that’s only a few years old. Check classified ads, eBay, Craigslist, Facebook Marketplace, etc. for used mowers being sold in your area.
- Much lower cost than new
- Still plenty of useful life left
- Often well-maintained by previous owner
- No warranty coverage
- May need repairs and maintenance
- Limited selection
2) Rent: Many home improvement stores like Home Depot and Lowe’s offer lawn mower rentals for reasonable daily or weekly rates. This can be a cost-effective option if you only need a mower occasionally throughout the season.
- Very affordable short-term use
- No maintenance or storage required
- Latest models available
- Inconvenient for frequent mowing
- Must return after use
- May need to reserve in advance
3) Manual Reel Mower: A manual push reel mower doesn’t require any gas or electricity. It uses human power to cut the grass. While not ideal for large, steep lawns, a reel mower can work well for smaller, flat yards.
- Extremely cheap to purchase
- No operating costs
- Low maintenance
- Quiet and eco-friendly
- Labor intensive to operate
- Not suitable for all lawn types/sizes
- No power features
4) Landscaping Services: Hiring professional landscaping services like lawn mowing and maintenance can spare you from needing to own a lawn mower altogether. Services may offer weekly, bi-weekly or monthly visits.
- No mower purchase needed
- Saves time and labor
- Professionally maintained lawn
- Ongoing service fees
- Scheduled visits only
- Loss of control vs DIY care
Evaluating alternatives like these could help you avoid taking on debt for a lawn mower while still keeping your lawn maintained. The right option depends on your specific needs and budget.
How To Improve Your Credit Score
Improving your credit score can help increase your chances of getting approved for financing a lawn mower or other large purchase. Here are some tips to boost your score quickly:
– Pay down debts: Focus on paying down your credit card and loan balances. Keeping balances low compared to your credit limits will improve your credit utilization ratio, which is a key factor in credit scoring.
– Dispute any errors: Review your credit reports and dispute any inaccurate or erroneous information. Getting errors corrected can give your score an immediate boost.
– Lower credit utilization: Keep credit card balances below 30% of the card’s limit. High balances relative to limits negatively impact your score.
– Avoid new credit applications: Each application can cause a small, temporary drop in your score. Limit new applications and space them out over time.
– Become an authorized user: Ask a friend or family member with good credit to add you as an authorized user on their credit card. Their positive history can be reflected in your credit reports.
– Pay on time: Payment history is the biggest factor in credit scores. Pay all bills on time including credit cards, utilities, loans, etc. Set up autopay if it helps.
– Monitor your credit: Keep an eye on your credit by reviewing reports regularly and watching for identity theft or other issues. Monitoring helps you catch problems before they worsen.
With diligence and patience, you can improve your credit score significantly in just 6-12 months. A higher score will open up better financing options for that new lawn mower or other major purchases.
How To Apply for Financing
When you’re ready to apply for financing, make sure you have all the necessary documentation and information prepared. This will help ensure a smooth application process. The application process will vary slightly depending on the lender, but there are some common steps:
– Choose the lawn mower you want to finance and obtain the full price. Many retailers can provide financing directly.
– Determine the loan amount needed. This will include the price of the mower plus any taxes, fees, accessories, etc.
– Complete the loan application. You’ll need to provide personal information like your name, address, Social Security number, income, expenses, and employment details.
– Be prepared to provide proof of income such as recent pay stubs, tax returns, or bank statements. Lenders want to verify you have enough income to repay the loan.
– If required, make a down payment. While not always mandatory, a down payment can improve your chances of approval. Save up if you can.
– Agree to a credit check. The lender will check your credit report and score to assess your creditworthiness.
– Submit the completed application and await a financing decision. This usually takes between 1-7 days.
Tips for Getting Approved
Here are some tips that can help with getting approved for lawn mower financing despite having bad credit:
-Provide a down payment of 10-20% if possible. This shows commitment and can offset credit risk.
-Only apply for the amount you need. Don’t max out the lender’s offered amount.
-Use a cosigner with better credit, if available. Their good credit essentially helps offset your bad credit.
-Highlight reliable income such as full-time employment or government benefits. Consistency is key.
-Explain any past credit issues. Being upfront shows the lender you are committed to repaying the loan.
-Consider applying with a lender known for approving bad credit, like a “buy-here, pay-here” dealer.
-Boost your credit score. The higher it is, the better. Pay down debts, dispute errors on your credit report, etc. Waiting to apply until your score improves can help.
With some preparation and diligence, those with bad credit can still obtain lawn mower financing. Being an informed applicant goes a long way towards approval. Maintain payments in good standing to begin rebuilding your credit.
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Financing a lawn mower when you have bad credit can seem daunting, but it is possible with some preparation and diligence on your part. While getting approved with poor credit can be frustrating, it is possible with some patience and discipline. Always make payments on time and use credit responsibly going forward. With diligence, you can improve your credit score over time and qualify for better terms in the future.