How to Get a Car Loan with Bad Credit   by Bill Arnold

in Finance / Loans    (submitted 2011-02-27)

When it comes time to buy a car and you need a loan but have bad credit, you may not know where to turn or who to trust. However, you can still get a car loan with bad credit if you know the ins and outs of the loan process.

What to do First?

First, keep your expectations on a lower level because the process of getting a bad credit loan takes time, effort and patience. Remember, too, that some car dealerships will finance the car for you or hold the paper on the deal. In addition, keep in mind that very few dealerships will allow someone with bad credit to finance a used or new car without any money down or no deposit.

Dealers with Poor Credit Financing

Then, look for car dealerships that advertise bad credit poor credit financing. Often they advertise their poor credit financing at the dealership, online or in a newspaper. These particular dealerships are better trained and prepared to help those who have poor credit. In addition, they may also be more agreeable to down payments and other requirements instead of a conventional bank or other lenders.

However, keep in mind that you may have to pay a higher interest rate because of your bad credit, compared to those who have good credit. Next, once you have found a car dealer you feel comfortable with, the dealer will then ask you to bring in certain documents such as a driver’s license, electric and phone bills, copies of your paycheck and other information that tells them you’re employed and that you’re living at a certain address. In the meantime, look over the kind of car you’re interested in while they work on the details of financing. Later, once you have made a decision on your purchase, the financing will begin. The interest rate will probably be high but some car dealers can put you into a refinance program later on, where interest rates can be adjusted to a lower level and this will help improve and enhance your credit.

About the Author

Bill is an online journalist who believes everyone deserves a second shot. If you need a bad credit car loan, be sure to explore all your available options.