The Best Plan for Buying a Car with Bad Credit
Buying a car with bad credit isn’t the end of the world. Millions of Americans are going through the same situation you are, but are able to find plenty of bad credit car loans available.
The hard part about shopping for a car with bad credit is making sure you’re ready to buy a car, and can absolutely afford to do so. I say this because you’ll likely have less overall selection with a small budget and a higher interest rate due to the risk associated with bad credit car buying.
The good news is, a car loan is a great way to prove to lenders that you’re paying your bills on time and are responsible with your credit.
Here’s a simple plan of action to get yourself ready for the car buying process:
Have a Job or Provable Income
If you’ve got bad credit, not having a job or provable income is going to make it extremely difficult to find a lender, including Buy Here Pay Here dealers. Making payments on a vehicle will also be difficult if you don’t already have a source of income.
Some situations might seem insurmountable, but you could get rides to work or take public transportation while you’re in your first few weeks on the job. Once you’ve got that time under your belt, and some extra cash, you might be ready to come to the dealership.
At Least 20-30% Cash as a Down Payment
Bad credit car loan lenders need some reassurance that you’re going to pay the loan back. Coming in with 20-30% cash as a down payment will allow you to get batter rate options, and could be the difference between getting a loan and being rejected.
And naturally, this will also reduce your overall commitment to pay back. If you’re struggling paycheck to paycheck, having that extra bit of cash to save each month will be a huge help in the long run.
Bring Commitment to the Dealership
Many bad credit loans come from the dealership themselves, so there’s no automated system telling the salesman or finance manager whether or not you’re worthy of a loan. Instead, it’s a very personal exchange, as the dealership is acting as the bank.
If you come in with confidence and commitment to paying your loan on time and improving your credit, the dealership is likely to give you the best loan possible.