Finding a reasonable auto loan is hard enough, but having bad credit can make it an almost impossible task. Even though public transportation and services such as Uber are on the rise, studies show that the vast majority of us require a car to get around, thus making the need for financing a vehicle a necessity in life.
If a less than perfect credit score has you fearing the worst rates in the market, then you should know that there are different avenues you can choose to take aside from the dealership. There are lenders out there that are willing to work with a bad credit score while still helping you to secure a reasonable loan. Some sites will even help you compare the best options for bad credit auto loans.
Pre-Work
Before speaking with any lenders, it is a great idea to check your credit score. In most cases, this would not only cost you money but lower your score as well. However, with sites like Credit Karma, you’ll be able to stay on top of your credit for free.
If at all possible, pay off any existing loans or outstanding bills. Even a slight boost in your credit score can open up a wide variety of new rates and better loans. Giving your score a quick boost before financing your vehicle is always recommended.
The next step before speaking with a lender is using a loan calculator. This useful tool will give you a ballpark estimate of your monthly payments and the amount of interest you will end up paying. Having this knowledge is crucial, and will help you to identify when a lender is trying to offer you something far less than you deserve.
Compare and Contrast
Now that you have a better idea of what will be available to you, it’s time to look into lenders. Online sites can help you view their pros and cons, customer experiences, and the types of rates you can expect to help you find the best banks for bad credit auto loans. Not every bank is going to work with bad credit, but here are a few that rank high on the list of helpful lenders.
- Auto Credit Express
This company specializes in helping those with bad credit finance vehicles. They even work with those that have already declared bankruptcy, and allow loans to special finance dealers. With an A+ rating from the Better Business Bureau, you are sure to find better rates than you could ever expect from the dealership.
Auto Credit Express will not restrict you from applying based on the usual criteria a dealership uses, including loan amount, the age of the vehicle, and and the mileage.
- Capital One
With online account management tools, competitive interest rates, loan calculators, and an Auto Navigator that helps you compare payments on specific cars, this company is a major name when it comes to helping those with bad credit. They work with high mileage and older cars, as well. The best part, you can get pre-approved for a loan from $4,000 to $40,000!
Capital One even offers helpful FAQ’s that cover everything from necessary documentation to what you can expect when you head to the dealership.
It should be noted that neither of these companies allow loans for a private seller.
Don’t Let Bad Credit Stop You
Bad credit is something that almost everyone experiences, but it doesn’t have to stop you from getting an ideal loan for your next vehicle. Utilizing the tools available to you, and comparing the companies with solid reputations for helping those with less than perfect credit can ensure you find something reasonable, and affordable. Never settle for the pitfalls of a terrible auto loan from the dealership again, get the kind of financing you deserve!
