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Can I Get a Car Loan With Bad Credit?

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car buyer shopping new car
Many dealerships will work with you to finance your new ride…even if your credit score is less than stellar

Need a new vehicle, but have bad credit? Getting a car loan might be more feasible than you think. Here are some strategies to increase your success before you apply for a car loan and finalize the transaction with your chosen lender.


Boost Your Credit Score: Learn about Zingo


Strategies for successfully securing a car loan

Know your credit score … and raise it if possible

Check your credit score, if you haven’t done so recently. If your credit score is in the “fair” or “very poor” tier, do what you can to boost your credit score before applying for a car loan, as Forbes’ Jack Ferry and Rachel Witkowski suggest. Make sure to pay your bills on time and fix any errors that you notice on your credit history report.

Provide proof of stability

Gather documentation that proves your personal stability. Per Ferry and Witkowski, lenders will typically ask you how long you’ve been at your current residence and place of employment. It’s good to have recent pay stubs and proof of your address on hand.

Set a budget

Establish a budget so you know what you can afford to spend on a vehicle, recommend Ferry and Witkowski. It’s best to do this before you start shopping for cars and applying for any auto loans so you’re not tempted to buy a car that’s outside of your price range.

Save for a down payment

Spend some time saving up for a down payment before applying for a car loan. Per Bankrate’s Hanneh Gundersen, this will increase your chances of getting approved for a car loan despite having a poor credit history. You’ll also want to make as large of a down payment as you can. It shows the lender how serious you are about paying off the car loan, says Experian’s Stefan Stolba.

Obtain pre-approval

Get preapproved for a car loan before you set foot on a dealership’s lot to find your new vehicle. Dealerships will be more likely to work with you to acquire financing if you’ve already been approved by your bank or credit union.

Shop around…and check with dealerships

Shop around for the best car loan before committing to one. Many car dealerships offer on-site financing either through a partnership with another lender. And some dealerships offer financing through an automaker’s car loan financing subsidiary such as GM Financial.

Discover the benefits of getting a car loan. Then increase your knowledge of how a car loan works.


Poor Credit? Find out about CARR Chevrolet’s special finance program