How to Get an Auto Loan with Bad Credit

If you are in need of an auto loan but have bad credit, you could be wondering if it’s even possible for you to secure financing without improving your credit score.

Although it can be harder to find a car loan when you don’t have good credit, you should know that you still have options. By following these tips, you should be able to secure the financing that you need to buy a good, reliable vehicle that you can be proud of, and you won’t have to wait for years for your credit score to improve.

Gather Up Documentation

When you don’t have a good credit score, you have to have a strong application in other areas. This means that you need to be able to prove that you make a decent income and that you will be able to pay your car payments on time. Gather up all supporting documentation, such as paycheck stubs or tax returns from the past few years. Also, make sure that you have the full name and business phone number for a supervisor or someone from your company’s payroll department. This is important so that you can have a strong reference when lenders look at your income and job information.

You will also need to have other documentation, such as a couple of forms of identification, proof of your address and a list of people who will give you a good reference. Make sure that you have all of this information on hand when you fill out your applications; then, you will help ensure that your application is filled out accurately and completely, which can help speed up the process.

Choose the Right Lender

Choosing the right lender will have a big impact on whether or not your application will be approved. Look for lenders who specialize in providing people with bad credit with the financing that they need; for example, Auto Loan Solutions is a great Canadian company that help buyers with low credit scores to find the financing that they need. Working with dealerships that offer dealer financing and with bad credit lenders can also be good options for securing financing.

Secure a Down Payment

Many lenders will be more willing to work with you if you have a down payment to put down on your vehicle. Try to save up as much money as you can; this can help you qualify for loans that you wouldn’t otherwise qualify for, plus you may be able to secure a lower interest rate if you have a sizable down payment. It’s also a great way to help lower your monthly payments, which can make your new car loan a little bit easier to manage.

Consider Adding a Co-Signer

If you have a close friend or family member who has good credit, it could pay off to let him or her co-sign with you on your vehicle loan. With a good co-signer, you might qualify for loans that you wouldn’t otherwise qualify for, and you might be able to secure a lower down payment as well. Just know that some people are nervous about co-signing with others, particularly those who have bad credit, because their credit can be negatively affected if you don’t pay your car payment on time.

Choose a More Affordable Vehicle

It can be easier to qualify for smaller vehicle loans than larger ones. For now, consider buying a used vehicle that is a little bit cheaper rather than something that is more costly and fancy. It’s easy to find a good used car on sites like, and if you can rebuild your credit with your loan and may be able to qualify for a higher loan later on.

Getting an auto loan with bad credit might seem tough, but it’s not impossible. Follow these tips, and you might find that it’s easier than you thought. Once you are driving your new ride, you are sure to be glad that you did.