Bad Credit
Car Buying Guide
Learn How to Buy
a Car With Bad Credit
The bad credit car buying guide is an easy source for you to learn how to buy a car with bad credit. Learn about your credit, how to bad credit auto loans, what cars you can buy and what scams to watch out for.I've written this guide in addition to the 11 step Car Buying Guide and geared it specifically to visitors with bad credit. Follow this simple 4 step guide and you'll save yourself big bucks on your monthly payments and thousands of dollars over the life of your loan. This information is "What You Must Know Before You Go!
Here's what the bad credit car buying guide covers: 1) Your Credit- What a lender considers "bad credit"
- Where do you stand on the credit scale
- Should you clean up your credit before buying
2) Bad Credit Auto Loans - Where to get a loan
- Buy here pay here dealers
- Will you need a cosigner
- Will you need down payment
3) What Kind of Car Can You Buy - Take your pick
- What helps you
- What hurts you
4) Scams to Watch Out For - Warranty
- Refinance
- Cosigners
- Spot Deliveries
Bad Credit Car Buying Guide - Your Credit
I know that you wouldn't even be reading the bad credit car buying guide if you didn't already know that you have some credit issues, but how bad are those issues? Have you actually seen your credit or are you just taking someone else's word for it? Do you know what your credit score is?This is all very important, because your credit may be better than what you think. It could also be worse than what you think, but either way you want to know before the dealer does.
Here's what you'll find below: - Why you want to know your credit
- Different levels of bad credit
- Should you clean up your credit before buying
Why You Want to Know Your Credit You must not let the car dealer know more about your credit than you do. If they are the first one to see your report, then they could potentially exaggerate the small things for their financial gain! Even if you are working with a legitimate dealer and they are being honest with you, what if your credit score is 522, but most of the better non-prime lenders won't consider applications under 540 (true in many cases)? Because of 18 easy to gain back points you are automatically disqualified from using a lender that may have approved you for a loan at 16%, but now are stuck using a lender that may charge you 24%. That 8% spread makes a big difference in your monthly payments ($50, $60, $70 or more) and how much you pay in finance charges (like thousands of dollars over the loan). Bad credit car buying can get expensive, due to these high rates, and you want to do all you can to get the lowest rates possible. I've seen many, many, many customers in this same situation that could have either filed chapter 7 bankruptcy or waited 2-3 months, cleaned up some basic stuff on their credit and would have saved themselves $50-$75 a month and possibly thousands of dollars over the life of their loan.
Do yourself a favor and Check your Credit Score - Fast, Free & Easy at CreditReport.com.
If you have small collections that you can easily settle, then do it. Every collection account reporting to your credit file drags your score down 10-40 points. If you have 3 small medical collections, settle them all and boost your score a quick 30-120 points. Be sure to have those collections removed completely, and not just shown as settled accounts, for maximum score boost and effect.
Different Levels of Bad Credit There are three different levels of bad credit car buying that I'd like to cover here. I'll base these examples solely on credit score, because to get into all the other details would turn this page into a book.
- 519 Credit Score and Below
If you fall in this range you would be in the sub-prime credit tier. Rates are usually in the 20's, loan terms are short (under 54 months), down payment needs to be big (30% or more), vehicle selection is limited and there aren't many lenders to choose from. You definitely want out of here! Start working on it today by getting your free credit score! 
- 520 - 580 Credit Score
If you fall into this range you would be in the upper sub-prime and lower non-prime credit tier. Rates in the high teens, loan terms up to 72 months (on select vehicles), down payment in the 10-20% range. Take a look here how one point cost this visitor and his wife from getting a Corvette - 519 Credit Score. See why it's worth it to stay on top of your credit?
- 581 - 620 Credit Score
Many more options for you here in the non-prime credit tier. More lenders available, rates from 12-18%, can borrow more, less money down (in some cases no money down).
Should You Clean Up Your Credit Before Buying If you absolutely have to have a car now, then you may not have a choice and can move on to the next section of the bad credit car buying guide to find out where to get a loan. If you have some time and the desire, then I'd absolutely recommend you do clean up some or all of your credit. Boosting your score and cleaning up your credit file will have a dramatic impact on all the factors mentioned above. Why buy a car today with $450 a month payments, when you could do a little work, wait a couple of months and buy the same car with payments of only $325 a month? What’s your Credit Score? Find out FREE!
Can't Wait? Then Let's Get Some Money! If you don't have the time to wait and need or just want to buy your new car now, then let's take a look at how to buy a car with bad credit auto loans. It's not as hard to get approved as you may think and in fact, there are lenders that 100% approve all credit situations.
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