What does it take to get a car loan with bad credit? It’s simpler than most people think. Bad credit doesn’t have to be a deterrent when financing a new car. Start your journey with these 4 steps, and find out why imperfect credit isn’t as problematic as you think.
1. Know Your Credit Score (and History) for Sure
If you haven’t already, the first step to finding a car loan with bad credit is to know exactly what you credit score is, and what your credit history looks like. You can use a credit monitoring service to check all 3 major credit reporting and scoring services to get a complete picture of the state of your credit.
2. Figure Out What’s Affordable
If you’re not sure what you can afford, there are online loan calculators and estimators that can help you estimate your monthly payments, loan amounts, and your loan’s interest rate. Knowing these estimates can help you plan ahead while you work toward financing a car. You can also start by researching the car you want. Check around for manufacturer recall notices, compare new and used car values, and get a VIN check from a reliable source.
Need a place to start? Check out myAutoloan.com’s free loan calculators and finance resources.
3. Research Your Loan Options
When getting a car loan with bad credit, it’s important you find out what all your options are. Bad credit won’t keep you from getting a loan, but you’ll need to be smart about how you do it. Fortunately, there are many lenders who are willing to work with people with bad credit and secure financing. Check out a company with online auto loan applications. The company will send your information to some lenders in your area that offer the kind of loan you need.
4. Round Up the Right Documentation
To get a car loan for bad credit, you’ll need to provide some documentation that proves you can pay off the loan. This documentation of certain requirements will help create a picture of your financial situation. First, you’ll need to prove you are employed and that you receive a certain minimum amount of gross monthly income. (Though this amount may vary, it is usually around $1,500 per month.) You will also need to provide proof of residence. If you have bad credit, having someone who will cosign your loan can help you secure the loan. This person should have good credit, as they are the ones who are technically guaranteeing that the loan will be paid.
Time to Get Started!
Got all your resources ready? Then you’re on your way to getting a car loan! Start by choosing the kind of loan you want and evaluate the loan offers myAutoloan.com gives you.