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Auto Finance FAQs

Answers to FAQs about Bad Credit Auto Loans, Credit Requirements and documents to bring at the dealership...

:: Frequently Asked Questions

Q: Can I finance a car with bad credit?
A: Yes, you can still find financing. There are a number of reasons now that a person may have a bad credit score. There are many lenders available to help you with your particular needs.

Q: What kind of car can I buy with my bad credit?
A: What you can buy depends on what you are able to pay each month. Lenders will look for your ability to consistently make a monthly payment for a certain amount.

Q: What down payment will I need to buy a car with my credit?
A: This will depend on the amount of the car you wish to buy and your credit rating. There are zero down payment options available, but keep in mind that for every $1,000 you put down you lower your monthly payment by at least $20.

Q: What other fees will I have to pay?
A: Taxes, title and license fees are the typical expenses when buying a car. There are times when these fees can be rolled into a loan. If you are getting a zero down loan, you might be better off paying these fees yourself to get a better interest rate.

Q: When would I use a co-signer?
A: A co-signer may help you qualify for a better loan rate and repayment terms. The amount of loan you will qualify for will still be based on what you make. The co-signer is only an assurance to the lender that the payments will be made every month.

Q: Can I get a car loan if I’ve gone through bankruptcy?
A: Yes, some creditors view the fact that you can’t file bankruptcy again in a few years as a good thing. The loan amount you qualify for will still be based on what you can pay every month right now.

Q: Will financing a car purchase help my credit?
A: Yes! If you make all of your monthly payments on time, your credit record will improve.

Q: How long does it take to get a loan approval if I have bad credit?
A: It won’t take longer than if you had a good credit score. Usually you will get approved in the same day.

Q: I’m new in town and have bad credit. Can I still get a car loan?
A: The typical requirements are that you have an address where you receive mail, and a source of income every month. Different lenders have their own requirements such as you might have to live at an address for at least 6 months to qualify.

Q: What do I need to bring with me to a meeting with the finance person?
A: The usual items you’ll need to take are:

  • valid drivers license
  • proof of your address, like a bill you received at the address
  • proof of income, like a check stub or bank statement