Tips for Getting an Auto Loan with Bad Credit

In these tough financial times, even those who have had perfect credit ratings in the past may have slipped down a notch or two on the credit score scale. It may seem like it sometimes, but it’s not the end of the world. You can still get auto loans with bad credit most of the time, but be prepared to have to jump through some hoops to get there. To help you toward your goal of securing a car loan even if you have bad credit, here are some tips.

Prepare a Big Down Payment

autoloan calculator Tips for Getting an Auto Loan with Bad CreditThis seems like a simple thing, but it goes a long way in helping you get an auto loan with bad credit. The more money you put down on a vehicle, the more serious the lender is going to take you. Why? Well, for one, if you have a lot of money wrapped up in the vehicle already, you’re less likely to default on the auto loan – and even if you do, the bank has a lot of the money already. The bigger down payment you have, the easier it’s going to be. If you can hold off a few weeks or even a few months and save up more for a down payment, you’re going to increase your chances of getting an auto loan even if you have bad credit.

Check and Fix Your Credit Rating

If you do have a low credit score, it’s a good move to get a recent copy and make sure there aren’t any mistakes – like a bill you paid off still on the report. Even if you don’t find any mistakes, you can still see if there is anything you can first pay off to get it removed from your credit report. Sometimes, if you’re very close to the next ‘level’ of credit, a few points will make all the difference on your auto loan application. Don’t expect to totally repair your credit rating quickly, but you should know your credit score and be working to make it better.

Employment History

The stronger employment history you can show on the auto loan application, the better your chances of securing the loan. Don’t ever lie on the application, but make sure you put down your full work history and explain any gaps you might have. Sometimes, even if your credit rating is bad, if you have a strong and steady history of employment the lenders will be more likely to loan you money for a vehicle.

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