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Getting a car loan with bad credit

Financing a car when you have bad credit is tricky, but it’s not impossible. There are several different options for people in Doylestown, PA who are considering buying a new Hyundai to get a car loan, even if they have recently been through a bankruptcy or have other blemishes on their credit report. The following suggestions can be great ways to get the car loan you need.

Getting a car loan with bad credit-slide0
Photo by Christian Petersen/Getty Images
  1. Apply for a regular car loan. While you may not get the best interest rates available, a lot of banks are willing to consider customers with poor credit. As you pay down your loan your credit will improve, making it possible for you to refinance the car loan later on with a better interest rate.

  2. Look for loans especially for people with bad credit. Many banks and credit unions have loan programs in place for people with bad credit. These programs may require you to go through some financial counseling or pay a slightly higher interest rate, but they are good ways to qualify for a car loan when you have really bad credit. These programs are a good choice for people coming out of a bankruptcy.

  3. Make a down payment. Even putting down ten percent of the price for a new or used Hyundai can make a big difference with whether or not you qualify for a loan. Being able to make a down payment shows the bank that you have an interest in the car, and it lowers the chances of going into default. Furthermore, if you are able to make a down payment, you will be able to lower the amount that you are financing. This means a lower monthly payment.

  4. Find a co-signer. A co-signer is a person who agrees to make payments in the event that you no longer can. By having a close friend or relative agree to co-sign a loan for you, it is possible to get a loan and in many cases even get a better interest rate. After your credit improves, it is possible to have the other person removed from the loan.

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