2 Places to Get Financing If You Have Poor Credit and Need a Car
If you want to buy a car with bad credit, you are not out of luck. You just need to be prepared and know what you are going to be dealing with when it comes to securing financing for your vehicle.
#1 Look for Dealerships that Finance In-House
First, look for dealerships that finance in-house. Many dealerships that finance in-house are willing to work with individuals who have poor credit backgrounds. They are also more willing to make deals than banks are.
When dealing with in-house financing, be prepared to show proof that you are gainfully employed. They may ask to see your pay stubs for the past few months to confirm that you are employed and that you have a regular job and stable income.
Dealerships that offer in-house financing may be willing to set up a payment schedule for you that is based on your pay-period instead of on a monthly payment. For example, the dealership may ask you to make payments on your paydays through a direct withdraw application.
Most of these types of car dealerships are going to be selling older cars with higher mileage. You will be looking at vehicles that cost under $5,000, but are still good to drive.
#2 Look at Local Banks and Credit unions for Financing
Another option is to go to a local bank or credit union for financing. Local banks and credit unions are often willing to work with local customers to help them get a vehicle. You may be looking at approval for a smaller loan with higher interest rates, but they should be willing to work with you.
You can increase your chances of getting a loan through a local bank or credit union by having money to put down a sizable down deposit. Being able to put down at least twenty percent of the purchase price, showing that you have money in your bank account, and proving you have steady employment can increase your chance of getting a loan.
If your credit is not great, you may still be able to get a car loan. Look for a dealership that will look at your work history instead of your credit history when approving you for a loan. You can also go to a local bank or credit union and see if they will approve you for a loan if you are able to put down a sizable down deposit on the vehicle.