Getting a new car, truck or SUV can be difficult with bad credit. If you have bad credit and need to finance a car purchase, you’ll want to give yourself every advantage to get approved with bad credit. You can get approved with bad credit for a car loan with less than perfect credit, but there are certain requirements that you’ll need to meet.
First of all, finding the right dealership is important. Not every car dealer is qualified to work with bad credit buyers. In fact, only dealerships that have connections with the right types of lenders will be able to help you buy a vehicle.
Checklist for a Bad Credit Car Loan
To increase your chances for car buying success, there are a few things you should do before visiting the dealership. Remember that anything you can do ahead of time to give yourself an advantage will make the loan approval process faster and easier.
- Check your credit report and score. Even if you’re pretty sure that your credit is poor, you’ll need to know exactly where you stand before applying for auto financing. Luckily, checking your credit is easy. Every 12 months, you are entitled to one free copy of your credit report from each of the primary reporting bureaus. So, if you haven’t checked your reports in a while, visit AnnualCreditReport.com to request copies from Experian, TransUnion, and Equifax.
You can also get your credit scores from these agencies for a small fee. Or, there are a number of websites that offer free credit scores. Also, check with your bank or credit card issuer to see if providing free FICO scores to customers is one of the services they provide.
- Pay down high credit card balances. If possible and if you have time, pay down the credit card balances that might be wrecking your credit score. Even if you’re making all of your credit card payments on time, if you’re using more than 30% of any of your spending limits, this can cause your score to drop.
So, if you can, put some money toward high balances and watch your credit score get at least a small boost.
- Get your documents together. When you apply for your bad credit car loan, you will probably need to provide a few things. These include a valid driver’s license, your most recent paycheck stubs, a utility bill addressed to you, a phone bill and a list of at least six personal references.
- Get a decent down payment together. Providing a down payment on your vehicle purchase will be helpful in several ways. First of all, because a large enough down payment will decrease the size of your loan, you will reduce the amount of risk involved for the lender. This might give you a better chance of getting approved.
Also, because you will be facing a higher-than-average interest rate as a bad credit buyer, putting cash up front on your car could save you a lot of money down the road. A bigger down payment means having to finance less. And the less you finance, the less you’ll have to pay in high-interest charges during the loan term.
Once you’re approved for your bad credit car loan, you’ll be able to get the car you need and an opportunity to gradually improve your credit with every timely payment. So, by the time you’re ready to purchase your next vehicle, you may qualify for better rates and terms.
Overdrive Automotive Center is the Best Choice for Your Situation
If you’re looking for the right dealership, Overdrive Automotive Center is ready to work with your situation. We’re able to find financing solutions for buyers with most credit types. So, whether you have bad credit or no credit, we’ll do everything we can to get your approved and back on the road fast.
Go ahead and fill out our simple and secure online application to get started today.