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100 Percent Financing Bad Credit Car Loans

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How To Get 100 Percent Financing - Even With Bad Credit

Let's admit it - we all need our own set of wheels these days: most of us have to get to and from work, go shopping, and see our friends. Even those of us who work out of the home need a car. Unless you live next door to a local train station and all of your destinations lie along that train's route (maybe a one-in-a-million chance), you need a car.

Buying a car is not always easy, however. This is especially true if you have a bad credit or FICO score (say, one below 600). It is hard to qualify for a low-interest loan when you have a bad credit score.

The problem is made worse when you do not have any money to put down on your car, since most lenders require a down payment of at least 5% to 10%.

Get A List Of 100 Percent Financing Auto Lenders Near You

Why Lenders Prefer You Have a Good or Excellent Credit Score

The Car You Want Is In ReachWhy do most lenders prefer borrowers with good credit scores? It's simple: security.

You see, auto lenders know that the minute you buy a car and drive it off the lot, the car's value decreases by at least a few thousand dollars instantly. That is because the car is now officially a pre-owned (or used) car, so the value has to drop as compared to when it was new.

Lenders know that borrowers with bad credit scores are more likely to default on the loan. That means, there is a higher likelihood with bad credit lenders that they will default on the loan - leaving the lenders holding a car that is now worth much less than it was upon purchase.

100 percent financing (no-money-down) auto loans are even more risky for lenders. Still, some lenders do offer this service.

Books On Buying A Car

These books can help you make the right decision when it comes to car financing.
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  • saimonhojak Mar 2, 2012 @ 6:13 am | delete
    Yes, it is an inspiration for me. I'm thinking of my personal blog
  • sarahrk Dec 24, 2011 @ 10:11 pm | delete
    Thanks for some good information. I have really bad credit, but need to buy a new car and need all of the advice I can get.
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Get Help with Bad Credit Auto Loan Approval

5 Tips For Car Financing With Very Poor Credit

If you would like to buy a new or used car, even with a very poor credit score, here are 5 tips that can help make your dream a reality:
  1. Start by choosing a car that has a reasonable price. Obviously, the higher the price of the car you buy, the more money you will have to borrow. So, keep it real and realistic, given your situation.
  2. If possible, save up as much money as possible for a down payment. The more you can put down, the lower the loan amount - and the easier it will be to qualify for a loan.
  3. Make a list of multiple lenders. There is no reason to stop at just one. By having multiple lenders to choose from, you are increasing your chances of getting the best-possible deal.
  4. Check your credit score with all three of the Big 3 lending bureaus (Equifax, Experian and TransUnion). Knowing your score before you start negotiations with auto lenders give you a leg up.
  5. As you start receiving offers from lenders for your bad credit auto loan, be sure to avoid taking the first offer you get. Remember, always go back and ask if they can do better before settling on any one loan. Tip: make sure to get quotes from at least 3-5 lenders before settling on a loan offer.

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OutdoorExplorer

Everett is a lover of all things travel, outdoors, and adventure. When he's not working as a freelance writer, he's traveling around the U.S. and beyo... more »

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