Financing a Car with No Credit

Shopping for a car loan with no credit so you can take home a used RAM 2500? You may have to put more money down than customers shopping for a car loan with comparatively better credit. You also will want to keep in mind that interest rates are higher. For some customers, purchasing a used car outright while they rebuild their credit with a secure credit card until they can afford to splurge on a vehicle they really want to finance is a good decision. For many others though, who desire more reliable transportation, it’s easy to find the right car and then secure bad credit car financing while keeping the following tips in mind.

Getting Approved Might Be Easier Than You Think

While you might have preconceived ideas about what kind of loan you’ll be approved for with bad credit or no credit the reality is that most lenders want to lend to as many people as possible, within reason. The riskier the borrower, the more the interest rate will be. Still, applying for a car loan with no credit or poor credit can be a great way to rebuild credit when paid on time. Talk to our finance specialists about your options if you think you might not be approved. Doing so could just leave you feeling pleasantly surprised afterward.

Think About How to Improve Your Credit Score

Start working out a payment plan and begin paying off any outstanding debts before applying for an auto loan if you can. If you’re able, use a credit card for small purchases here and there and pay them off immediately. This will help you rebuild your credit.

Apply for New Loans Together

Whether financing a car with bad credit or good credit, your credit score can be negatively impacted by too many loan applications. To help reduce this risk, make sure you apply for all the loans you want to apply for within a 14-day period of time.

Be Selective About the Loan You Take On

You don’t have to accept the first loan offer just because you feel that your credit needs work or you feel you won’t’ be approved elsewhere. You have the power to choose the loan that makes the most sense for you. Many car dealerships finance through a variety of lenders, so if you think there’s a good chance you could get a better offer, hold out and wait for the loan that’s the best fit for your needs. Don’t be afraid to seek out advice from different sources to ensure you’re making the most proactive decision for your financial future.

Be Ready for Higher Costs

You may receive higher interest rates, a larger down payment, or both if you have no credit or bad credit. Keep that in mind as you go through the bad credit finance process.