To either regain or establish auto credit car shoppers with problem credit may need to apply for a car loan with a higher-risk lender.
Car shoppers that have experienced some type of problem credit will find that it’s not just income but an individual’s income after expenses that subprime auto lenders consider most important in determining whether or not they’ll qualify for an auto loan.
When they ask us “can I buy a car with bad credit and a large down payment?” we sometimes have to remind ourselves that, for these consumers, financing a dependable vehicle used to be much more of a problem.
When it comes to repairing car credit, in most cases an auto loan offered by a high-risk lender is the only choice for most consumers.
While it isn’t as far reaching as the changes announced last year by Volkswagen and Chrysler, the recent changes made by Mazda to their certified used car program mean that car buyers with questionable credit can now shop with greater confidence once they’ve received a car loan approval at a Mazda dealer.
For car shoppers with past problem credit or even those with absolutely no auto credit at all (that is, they’ve never had a car loan) where they decide to apply for one can often mean the difference between a loan approval and a credit denial.
Most credit-challenged buyers will end up financing a lower-mileage used car. But in some instances even these consumers are given an option – one that largely depends on factors such as income, credit history and the programs offered by their particular lender – and that is an affordable new car.