No Credit Car Loans

It can be very difficult. Most dealers that advertise "guaranteed credit" are, in fact, buy here pay here dealers. These car loans for people with no credit use what Canadians call "in-house financing" and hold the contract on the vehicle, themselves. These car dealers often don't run a credit check and you make your car payments monthly, weekly, or even bi-weekly. And while these types of no credit car loans might seem appealing, they usually won't do anything to improve your credit score (also known as a FICO score). These dealers rarely report your positive payment history to the three major credit bureaus so making timely payments on this type of will not help you the next time you want to finance a car, since your credit score will probably still be low.

Other types of car loans for people with no credit can be applied for at a dealer that is signed up with a number of major national subprime lenders. Getting a loan with one of these lenders (many are banks) is more difficult than a "tote the note" dealer, but the type of vehicle that qualifies for this kind of loan is generally much newer with far fewer miles on the odometer. In addition to a newer and more reliable vehicle, the interest rates these lenders charge are, at least by comparison, lower than those charged by tote the note dealers.

More importantly, the lenders that offer these no credit car loans will report your payment history to the credit bureaus. By making your payments on time, you can actually improve your credit scores while driving a new or nearly-new car or truck.