How To Buy A Used Car With Bad Credit

Need to know how to buy a used car with bad credit? Don’t let bad credit stand in the way of your used car purchase. Although a bad credit rating can make obtaining financing more challenging and result in you paying higher interest rates on your used car purchase, it doesn’t mean that you won’t be able to buy a car at all. Once your credit improves, you can always refinance to a lower interest rate to secure lower monthly car payments. 

1. Check your credit score to find out just how bad your bad credit really is. You can purchase your actual FICO scores, the ones lenders use, directly from the Fair Isaac Corporation by purchasing them through their website.
2. Evaluate how much cash you have on hand to put toward your used car purchase. The bigger your down payment, the more likely a car dealership or lender is to overlook your bad credit. If you have enough cash, you may even be able to purchase the car outright without obtaining financing at all.
3. Check into special purchasing deals for individuals with bad credit. Car dealerships often have promotional programs to help buyers with bad credit to purchase a used car. Visit different dealerships, explain your situation, and inquire about financing. Get an interest rate quote from any dealership willing to finance you and compare that interest rate with other dealerships’ financing programs.
4. Get a co-signer to help you buy your used car. If your credit is so bad that no car dealership is willing to offer you financing, having a co-signer can make a big difference. A co-signer is an individual with good credit who agrees to take on full responsibility for your used car loan if you don’t make the payments. Dealerships can then finance you at a lower risk since the co-signer agrees to repay the loan no matter what.
5. Choose the right used car dealership and the right car. Read and sign your loan paperwork. Make all of your payments on time. Not only does this ensure that the dealership won’t repossess the car, it helps you build good credit that can help you qualify for lower interest rates on future loans.