There are many ways to get a car loan for people with bad credit. These options include online lenders that specialize in these types of loans, BHPH dealerships, Special finance dealerships, and Credit unions. Having bad credit is not fatal for secured loans, but it can have an impact on the terms and conditions of your loan. Checking your credit score will help you predict the terms and conditions of your loan.
Online lenders specialize in car loans for people with bad credit
There are many car loan options for people with poor or no credit histories. You can work with many of the top picks for people with bad credit to get the loan you need. However, you should be prepared for higher interest rates and stricter loan terms. In some cases, the loan amount may also be smaller.
To get the lowest rates, you should shop around. Some online lenders specialize in bad credit loans. For example, RoadLoans is one of the largest auto lenders. It takes applications from people with any credit profile and prepares multiple offers. You can also get an instant decision.
BHPH dealerships
BHPH dealerships for bad credit may be the best option if you’re trying to buy a car, but you don’t have a good credit history. Fortunately, these dealerships are very flexible and can work with consumers with bad credit. Because these dealerships are lenders, they can approve you for a loan. However, you will likely have to pay a higher interest rate and down payment to obtain a car loan from one of these dealerships.
BHPH dealerships for bad credit are different from traditional dealerships in several ways. First of all, BHPH dealerships sell only used cars. Second, they generally do not run credit checks, and you can get approved even if you don’t have an excellent credit score. BHPH dealerships for bad credit also work with lenders who specialize in subprime financing. They do this by working through the dealership’s special finance department.
Credit unions
A credit union is a cooperative that offers financial services to its members. Its primary goal is to offer loans at better rates than commercial institutions, and many credit unions have special programs for people with less than perfect credit. Here’s how a credit union can help you get the vehicle you want.
When it comes to financing your car, credit unions offer better rates than banks. This is because many of these institutions have lower credit score thresholds. For instance, the credit union I belong to offers the lowest auto loan rate for borrowers with credit scores under 650. The typical car loan rate at a bank requires a credit score of 750. Because of this, credit unions have a higher likelihood of working with people with derogatory credit.
Special finance dealers
Special finance dealers for bad credit are lenders that work with people with bad credit to help them finance a new or used car. These lenders are often subprime lenders, which means they only work with dealerships with a special finance department. Unlike traditional lenders, they don’t look at your credit score when approving you for financing. Rather, they base their approval on your income and down payment, which are similar to subprime lenders’ requirements. They also tend to have fewer requirements when it comes to documentation and may have more flexible requirements regarding the vehicle you are purchasing.
Special finance dealers for bad credit can offer financing to those with a variety of credit backgrounds and credit histories. These dealerships usually don’t advertise these types of loans, but they do exist and are an excellent option for people with bad credit. To qualify for financing, you must make at least $1,500 a month, before taxes. You can prove your income by providing a recent computer-generated pay stub.
