3 Ways to Get a Car Loan With Bad Credit & No Money Down

If you have bad credit you have probably been to more than one car dealership that has turned you down. This is very common that people don’t accept the opinion of the first car dealer and so they go looking for a second opinion much like many people do with doctors. We just don’t like to hear the bad news and were looking for someone that will tell us what we want to hear.

Here are three ways that you can get approved for a bad credit car loan without having to put any money down.

1) If you have a local bank or credit union that you have your checking account with, you may be surprised to find that they will actually offer you a car loans so long as, you have a reasonable average balance and don’t ever have any overdrafts. You will have to have a stable place of residence that you have probably been added for at least two or three years, you will need to have been eager job for a considerable amount of time, and the price of the car needs to be within certain guidelines. These guidelines will relate to the loan amount. The loan amount versus the loan value. Getting a car loan with no money down using a local bank or credit union, means that you will have to find a deal on a car that is priced at or near loan value.

2) Buy here pay here car lots are not the cheapest place to buy a car, however financing is very easy. Some places do not even have a credit check and don’t really even have any requirements whatsoever, other than having a down payment. The only way to avoid a down payment when buying a car at a car lot that finances their own cars, is to have a trade-in that is either paid off or has considerable equity. This is not the best option for you if you want to save money and get a good deal on a car, however, I mentioned this information in this article because buy here pay here car lots are commonly considered as an option when you have credit problems and need a car.

3) Online loan companies that are legitimate, can offer you finance saying with no money down and guidelines and lending standards are quite a bit different from those that you will find when using a local bank. These types of lenders work only with people that have bad credit, and are in business just to help people out there that have bad credit and can’t get financed at a car dealership. This is by far the easiest way to get a fast approval, get lower monthly car payments, and a better interest rates. One of the great things about using a service like this, is that you can pick and choose what model and make of car that you want, without being limited to what just one car dealership has to offer.it is much easier to get a no money down car loan when you are able to shop around and find a good feel on a car. When you can do this you can find good deals and local classified newspapers, bargain hunters, and even on on line auction sites.

Seeking Car Loans With Bad Credit: Factors to Consider Before Applying

Buying a car is a major investment for young people, and a vital one for others. Whether an automobile is needed for work purposes or simply to get around in, it is hard to survive in this society without one. The trouble is secure a car loan with bad credit is not a simple thing.

Just how an applicant might have attained a low credit score is down to any number of reasons. The most common is simply falling behind on repayments, but losing a job or getting county court judgments can also be major contributors.

Getting loan approval with poor credit scores is never easy, but there are options available. And even when it comes to getting a car loan, applicants with very low credit ratings can get the green light to buy the car they want.

Why Seek The Loan?

Young drivers are finding it more difficult to buy a car because their credit ratings are low. The reason for low credit scores can vary, but the lack of a credit history is partly responsible. So, young people usually have to apply for car loans with bad credit scores holding them back.

Therefore, getting a loan with which to purchase a car is not a simple task. This comes as no surprise, given that approval with poor credit scores is never easy anyway. But by applying for a loan specifically designed to cater to the bad credit borrower, the chances of success are greater.

Of course, the reasons for having bad credit can also be down to financial woes, perhaps created by a sudden loss of employment. However, the need to buy a car for a new job, or to develop your own business, means a car loan is necessary.

The Trouble With Bad Credit

It might seem strange that even with a terrible credit rating applicants can get the funds they need to buy a new car. But it is no strange thing at all. Securing car loans with bad credit comes down to the simple fact that bad credit scores are not a major issue for lenders – there are bigger influencers on a loan application.

Bad credit ratings are only an indication lenders go by when assessing an application, telling them the degree of risk associated with a loan deal. But today, so many people have seen their credit status adversely affected through no fault of their own that the score alone no longer has much influence.

Instead, getting loan approval with poor credit scores is dependent on income and the debt-to-income ratio. The ratio permits no more than 40% of income to be spent on debt repayments. So, if the repayment on the car loan pushes the percentage above that rate, the application will be rejected – if not, then approval is almost certain.

Clearing the Bad Credit Hurdle

The temporary nature of credit scores means that approval of a car loan can always be justified. Other than proving a large enough income and establishing repayments are affordable, showing an improvement in credit scores can have a major impact on an application.

Remember, not everyone gets bad credit scores because of poor money management. In many cases, it is as a result of redundancy, or economic developments or just plain bad luck. So, there are mitigating circumstances that lenders take into account. That means loan approval with poor credit scores is always possible.

Clearing some minor debts does improve matters, while a consolidation loan to completely restructure debts is also helpful. However, the car loan is unlikely to come cheaply, with higher interest rates to pay. This means the loan is more expensive, but approval makes it worthwhile.