No money down car loans are possible in Seattle, but usually only if you have good credit. Unfortunately, many Seattleites who don’t have perfect credit and need an auto loan are likely going to be required to make a down payment. However, you may not need to make a large one if you're working with the right lender.
Down Payment Requirements for Subprime Lenders
Bad credit car buyers in the Emerald City should be looking for subprime lenders. These lenders work with special finance dealerships, and focus on bad credit auto financing. They run credit checks, but they also consider outside factors such as income, residence stability, and – of course – your down payment.
A down payment is usually needed for approval, but most subprime lenders in Seattle have a minimum requirement that isn’t difficult to meet. This varies by lender, but most require $1,000 or 10% of the vehicle’s selling price, whichever is less. You can meet the requirement by using cash, trade-in equity, or a combination of both.
Does a Larger Down Payment Help?
You can meet the minimum down payment requirement, but we recommend you put as much down as you can if you have bad credit – the larger the down payment, the better.
It may feel like a waste of money, but you end up saving even more in the long run. This is especially true if you have bad credit, since you're more than likely to get approved at a higher than average interest rate.
Not sure how this works? Let’s take a look at a typical example.
Jane lives in the northern part of Seattle, and wants to finance her next car for 60 months. She doesn’t have the best credit, and is on a tight budget. She’s looking at a vehicle selling for $10,000, and has a trade-in appraised at $2,500, and is approved at an interest rate of 14%.
Here’s how increasing the down payment can make her auto loan cheaper:
| Down Payment Amount | Monthly Payment | Total Interest Paid |
| $1,000 (typical minimum) | $209 | $3,565 |
| $2,500 (trade-in amount) | $175 | $2,971 |
| $3,500 (trade-in amount plus $1,000) | $151 | $2,575 |
The more Jane puts down, the more she saves over the course of her car loan. She can use her trade-in and knock down her monthly payment to under $200, but if she adds cash on top of that, she can save over $1,000 in interest charges and lower her monthly payment.
Ready to Find a Dealership in Seattle?
You can make the minimum required and be okay, but if you can you should make a larger down payment if you have bad credit. You can save money on the overall cost of the loan, and lower your monthly payment.
If you have a down payment ready, but don’t have a dealer to work with in Seattle, we want to help you find one. At Auto Credit Express, we work with a nationwide network of special finance dealerships that have lending resources available to assist people in all kinds of credit situations. There's no cost, our process is fast, and it's easy to get started. Fill out our online auto loan request form to get started today.
