Car buying doesn't have to be painful — and having bad credit doesn't have to prevent you from getting an auto loan. If you have poor credit, financing a new car is possible. A lot of people who have poor credit assume that auto dealerships don't want their business, but with multiple lenders offering new-car loans for people with tarnished credit, you can get in the driver's seat. It's easy to get turned away from dealerships when your credit score is low because most car dealers focus on customers with good or exceptional credit. But here's the good news: plenty of car loan options are available to people with lower scores.
Try Subprime Lenders
A low credit score doesn't have to stand in the way of getting an auto loan. There are lenders who are willing to work with people who have less-than-perfect credit. These lenders offer bad-credit auto loans, and they can help you get in a car fast.
Subprime lenders specialize in working with people who have less-than-perfect credit. They're also known as "bad credit lenders," and their primary focus is helping borrowers with low credit scores get approved for an auto loan.
Understanding Credit Profiles
There's a common misconception that bad credit will automatically prevent you from getting a car loan, but that's not always the case.
While it is true that having poor credit can make it more difficult to get a loan, people with low credit scores can still secure financing for their next vehicle.
If you need a new car but have been through bankruptcy or foreclosure in recent years, don't give up hope just yet. Consider these tips for getting an auto loan with bad credit:
- Get your free annual credit report
- Keep an eye on your score and look for errors
- Improve your credit score
Understanding and improving your credit profile will make it more likely for you to secure a loan.
Gather Your Documentation
The first step in applying for an auto loan is to gather the necessary documentation. This includes proof of employment so lenders can confirm that you have the ability to make payments, as well as proof of income in the form of pay stubs or bank statements. You should also be prepared with documents like your driver's license and Social Security card.
Contact a bad credit financing dealership to discuss options for getting financing for a car.Share