Can I Get a Car Finance

If you have a credit score of less than 500, you can still obtain a car loan. The key is to shop around. Multiple inquiries on your credit report within 45 days are counted as one inquiry by FICO and VantageScore scoring systems. You may want to choose a smaller vehicle, which means a lower down payment. While you may not be able to obtain a large auto loan, you can qualify for a smaller one.

The best way to avoid paying too much for a car finance for bad credit is to work with a lender with an aggressive credit-card-approval process. Many dealers will raise your APR, making you pay more in the long run. If you have bad credit, look for a dealer who will lower the interest rate, which will help your credit score improve. In the end, you will be happy you chose a dealership with a good credit-card program.

Another option is to seek out a car loan from your bank or credit union. This option is available to people with less-than-perfect credit. It involves applying for an auto loan from the bank, receiving a pre-approval and then taking the car to the dealership. You then pay back the auto loan directly to the bank on a monthly basis. While a bank loan will take a few more days, it is a great option for many people.

Can I Get a Car Finance With a Credit Score Under 500?

While a low credit score will not necessarily disqualify you from a car loan, it will greatly affect the cost of your car loan. A lender will place you in one of four categories, and the lower your credit score, the higher your monthly payments will be. Oftentimes, the interest rates will be higher than average, but this is offset by the fees associated with a bad credit car loan.

There are many options to consider if your credit score is low. A loan with a low credit score will usually be more expensive, but it can still be possible to get a car loan. If your score is lower than 500, you may need to seek a loan refinancing option. A refinancing auto loan involves taking an existing loan and obtaining a new one with a lower interest rate.

Although you cannot qualify for a car loan with a credit score under 500, there are still many options available to you. The most obvious is to work on improving your credit score by paying off past due bills and avoiding new credit. While a lower interest rate will be available for those with less than perfect credit, it is important to keep your financial future in mind when applying for a loan.