What Can I Do When I Need A Car But Have Bad Credit?

by Mike Reitz
Show Me Cool Cars

Here's what you can do when you really need a car but have bad credit. Don't give up. Yes, financing a car can be a challenge when you have poor credit. However, it is doable. Be careful of getting stuck in a loan with super high interest rates and huge monthly payments, that you can't afford. Those high payments can make your credit worse than what it already is. If you find yourself needing a new set of wheels, even with bad credit, there are ways to finance a car in spite of your bad credit.

Take a deep breath, relax and open your mind to some new possibilities that you might not have thought about before.

Before going out to look for a car, pull your own credit report so you know exactly what you are working with. Look at your "FICO" score on the report. Lenders use this score to rate and determine if they will make a loan to a potential customer. Generally speaking if your score is 600 to 700 it is okay but under 600 it is bad and considered a high risk loan.

Start saving money for your down payment as soon as you can. The more money you can put down, the better chance you have of getting approved. Take a look around your garage or basement and see if you have anything to sell that you are not using anymore. The proceeds from these items can go towards the down payment on your new ride.

Choose a car on affordability, not on what the coolest style is this year. Dealers stock cars that will fit the parameters of their loan stipulations and guide lines. When you have bad credit you are at the mercy of the lenders programs, you can't be picky on what car you want.

Find a dealer that offers programs for people with bad credit. You may also want to check with an auto broker. Brokers may offer solutions that you may not get anywhere else, because of the nature of how they do business. They work for you and represent you. Similar to how a Realtor represents you in the purchase or sale of your home. They have your best interest at heart.

Once you get approved, keep your car for as long as you can. Make your loan payments on time for the life of your loan. If you can make extra payments monthly, then by all means do so. This will help pay your car off quicker and save you in interest charges.

Article submitted Tuesday, May 24, 2011 & read 1 times.

Mike Reitz is a Denver Auto Consultant, teacher and author who regularly contributes eBooks and articles designed to show you how to get the best deal on your vehicles. If you would like to learn more, Click Here...we have the antidote for your car buying blues during and after your bankruptcy.

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