About 11-20 percent of Americans report having low-moderate FICO scores. These percentages may seem low, but they have consequences for those with bad credit.
Truth is, most of us have experienced our share of bad credit problems, whether minor or serious. If your credit score is low, buying a car can be a real issue.
If you need a new set of wheels but have a few blemishes on your credit history, discover how to get a car with bad credit and no down payment!
How to Get a Car With Bad Credit and No Down Payment
Bad credit can seem like the end of the world, especially when you feel you can’t get yourself out of that hole. For many, buying a car is a crucial component of transportation.
Unfortunately, buying a brand new car with bad credit is difficult. To car companies, bad credit equals high risk.
However, buying a nice, used car is doable even with a low credit score.
Work on Credit
If you are looking for a car but have bad credit, start working on building your credit as much as possible. It doesn’t have to rise substantially, but getting it up a few extra points will help.
Pay everything on time, including your rent, mortgage, and credit card bills. If you don’t have a credit card, find one that is flexible with low credit scores. Use it to make small purchases and pay it off on time every month.
Find a Loan
If you are wondering how to get financing for a car with bad credit, you should think about a car loan.
Find a lender who will help you secure a loan. Look for an auto dealer who offers in-house financing. These types of dealers will sometimes be more understanding toward people with bad credit.
Though, you will more than likely have to pay a higher interest rate with a bad credit car loan.
Several options of lenders can help you with a loan:
- Banks
- Credit Unions
- Car Dealerships
- Buy here, pay here businesses
You can also use paystubs to apply for a car loan.
It’s a good idea to shop around online for reputable websites. Don’t choose the first one you come across. Instead, compare a few to each other so you can find the network to help secure that loan.
Stick to Your Budget
Don’t expect to find a brand new car available to you right away. If your credit isn’t the best, it would be in your best interest to stay within your budget.
By finding a car you can easily afford, you can make payments on time and avoid adding more bad credit items to your score.
Get a Co-Signer
If you want to avoid a down payment, asking someone who has good credit to co-sign is a good idea. Having someone else sign on ensures to the car company that if you can’t pay, someone else is accountable.
Don’t Let Bad Credit Stop You
Bad credit can be a weight on your shoulders, but it doesn’t have to keep you down forever. With enough effort, and a little research, you should be able to find an affordable, reliable car.
We hope these tips on how to get a car with bad credit and no down payment will help anyone out there experiencing credit problems.
For more information on buying, selling, or repairing cars, check out our website.