I just checked my credit score and it’s “very poor” – can i get an auto loan?

Deal Score0

I don’t have any delinquent accounts but i do have a mortgage, car note, student loans, credit card debt, etc.

With a $ 1000+ down payment and paying off my current auto loan, could i still qualify for a new auto loan on my own?

  1. Reply
    Rain L
    May 3, 2011 at 5:58 am

    Yea, sure you can get an auto loan but maybe the interest rate will be pretty high like 8 or 9%. also usually they ask for about 20% down of what the car is worth. You can always get a loan even if your credit score is slow, its just you have to pay a higher interest rate.

  2. Reply
    May 3, 2011 at 6:08 am

    Its going to depend on your debt ratios. You should probably pay off your current auto loan first, and pay off that credit card too.

    If your credit score is “very poor” you may not be able to finance a new car. You may have to get a used car, but this can be a used car that is 1 year old and still under the factory warrenty. Also, you will get a higher interest rate than someone with good credit.

  3. Reply
    May 3, 2011 at 6:09 am

    It’s impossible to tell. You did not state what your score is. If it’s 540 or over you can get approved as long as your debt to income ratio is not to high. Oh by the way, anyone who thinks 8% or 9% is high for people with bad credit should not be answering these type of questions.

    I contract people everyday at rates in the high teens.

  4. Reply
    May 3, 2011 at 6:14 am

    If your credit is Very Poor you could probably get an auto loan but it will be tougher. They will take a big look at your debt to income ratio, if that is too high you will not get approved.

    If you do get approved your interest rate will be higher, probably in the 18%-20% range. They will also require a downpayment, this can vary but will usually be minimum of 10%. So if with 1,000 down you would probably only be able to finance at most $ 10,000.

    If you have a lump sum to pay off your current car, I would still do that. But don’t get a new car right away. Instead take the money you would be paying on the new loan each month and save it. Then in a few months you will have more of a downpayment, which will make qualifying easier.

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