Finance a Car with Bad Credit

There’s not really a lot of reliable information available on how to finance a car with bad credit. What you may find surprising is the description doesn’t really explain the fact that what you may think is bad credit really isn’t. Many people think they have bad credit and can’t get a car loan just because of maybe something like a late payment somewhere in their credit history. A good car loan lender has adjusted their underwriting guidelines over the last 3 years to take into consideration some of the things that have happened during that time.

The facts are that it’s fairly easy to get financing for a car loan with bad credit or at least what most consumers consider bad credit. Heck there are only a few credit related items that would truly put you into a bad credit financing situation. Some of those items would be if you had multiple repossessions or repossession within the last year. Most car loan lenders consider that to be just too much of a risk. If you have never had a history of paying your credit obligations on time, most likely you would not be eligible to finance a car through most reputable car finance companies.

Believe it or not bankruptcy and getting a car loan after bankruptcy is pretty easy. Especially if you had a chapter 7 bankruptcy, you can get a new or used car loan easier than some people with very high credit scores. The only exception to this would be if you were in an open chapter 13. The bad credit car financing programs simply are afraid of the fact that you may convert the chapter 13 into a chapter 7 and it makes things more difficult for the lender.

Here are some suggestions that will help you in your search to find car financing for bad credit.

  • Be realistic in your expectations. If you can afford a monthly car payment of $200 then you are going to have to buy a car that fits that budget. If you can afford $400 then obviously you can afford a car that’s more expensive

  • Be prepared to have a down payment available. It will absolutely make the finance companies give you more consideration. There are programs available with no money down so if you don’t have it, don’t worry about it.

  • Know your credit score, again so you can be realistic about your finances. People with low credit certainly can get a car loan.

  • You will have to be able to prove your income. If you happen to have a spouse, you should apply jointly as it will improve your chances.

  • There are many programs for special finance situations all over the country. There should be no costs of fees especially if you are going to apply for a car loan online.

  • You can get pre-approved for a new or used car loan usually within the same business day.

The information we have shared with you above comes from more than 35 years experience as a car loan lender and auto dealer. This guide is intended to help those people that need help in understanding how to finance a car with bad credit or what they think is bad credit and really may not be.

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