We’ve all been there at one point or another: you need a new vehicle badly, but your credit history has not been looking the best these past few years. While that may have been a crippling issue just a decade ago, these days there are more and more options for getting auto loans to those with bad credit.
While there are sometimes bad credit loans available from popular lenders, there are some lenders that have specifically entered the market to help those with credit problems and limitations. The downside to these loan programs is that they often require higher interest rates and as a result, higher payments on the loans themselves. But there are still some great benefits to some of these lending programs, take a look:
New Roads Auto Loan
New Roads is a direct lending division of Consumer Portfolio Services Inc. Consumer Portfolio Services Inc. is a general finance company that offers indirect automobile financing to consumers with bad credit. They also can help consumers with low incomes or limited credit histories.
New Roads has loan programs for both new and used vehicles, refinancing, as well as lease buyout options. While they do not require a down payment, financing without one means you finance a larger amount. This can increase the amount you pay over the life of your loan.
They consider applications from consumers who still have a repossession or bankruptcy (open or closed) on their credit reports. They also make allowances for co-buyers as well. One downside is that New Roads is only available in 30 states, so depending on where you live, you may not have access to them.
Capital One Auto Finance
One of the biggest draws to Capital One, in addition to their willingness to work with less-than-stellar credit, is the ability to prequalify for a loan, before having them do a hard pull to confirm. As people trying to rebuild their credit know, a hard inquiry can affect your credit score if you have too many within too short of a time. With Capital One you can get a pre-qualification and can check the estimated terms and payments before deciding if you want to commit to a full application.
They offer loans for all types of vehicles both new and used, and they offer to refinance existing loans from other loan servicers as well. They have a minimum loan amount of $4,000, and the loans can only be used at a participating car dealership, though there are 12,000 of those. In order to apply and qualify, you will need to be 18, have an income of between $1,500 and $1,800 monthly, and live within the lower 48 states.
The maximum loan amount you will be approved for will depend heavily on your income, credit history, and other factors. However, when you are approved, you will be able to use the Auto Navigator tool to find your vehicle of choice.