Buying a car

Do you need a car loan but have less than stellar credit? Buying a car with poor or no credit is much easier than buying a house without credit once you know how. It's true that getting approved for car loans today is tougher than it was several years ago; however, there are still options available even if your credit is downright bad. Just How Bad is Bad Credit? Every lender is unique as far as their criteria for loan approval, but in general you are considered a bad credit risk if your FICO score is less than 660. If you've filed for bankruptcy within the last five years or have a large amount of credit card debt, you'll also find shopping for approvals challenging. Other Factors to Consider In addition to your credit score, lenders look at the amount you're putting down and the car you're buying. Getting approved for a new Range Rover when you'll need to borrow $50,000 will be much more difficult than buying a new Prius for $20,000, for example. How to Get a Car Loan with No Credit Getting approved with no credit is slightly different than getting approved with bad credit. Many people will tell you to get a cosigner if you don't have established credit yet. Having a parent or spouse cosign your loan can not only get you approved for the car loan, but can also get you on the path to establishing credit history. Another option if you have no credit is dealer financing. Some lots offer "Buy Here, Pay Here" financing deals on used vehicles. These types of offers have become fairly common, and shopping around from several lots could get you a better interest rate. Unfortunately, you'll have to settle for whatever type of vehicle the dealer will approve you for with this type of financing.