Having bad credit shouldn't keep you from being able to get approved for a car loan. However, it does limit the kinds of lenders who are willing to work with you. With that in mind, here are some tips on getting an auto loan when you have bad credit.

Tip 1: Prepare Your Credit

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Before applying for a car loan, or any type of loan for that matter, the first step should be checking your credit reports and scores. Lenders will be carefully evaluating your credit before making any decisions, so you should too.

You can request your credit report from the three major credit bureaus at annualcreditreport.com. In fact, you are entitled to a complimentary copy of your report from each of the three bureaus every 12 months. You should also find a way to view your credit score.

Doing so allows you to get a handle on your credit situation well in advance of applying. It also presents you with an opportunity to for look for areas you can clean up before you apply. Even the smallest improvement in your credit can help you with your car loan.

A good tip is to order all three of your reports and closely look them over for errors. If you find any, you are entitled to dispute them and have them removed. Once any changes take effect, this practice can improve your credit score.

Tip 2: Try Your Local Bank or Credit Union

Most banks and credit unions do not work with applicants with bad credit. But it doesn't mean that you shouldn't try.

It helps to start your auto loan search by going to your local bank or credit union. Not only do you stand a better chance of getting approved if you have an existing relationship, but banks and credit unions tend to offer lower rates than other lenders.

So, if you have an account with a local institution, head there and ask about car loans. Hear what they have to say and see what they can do for you. Even if you don't have an account, you may still want to explore this option. This is because getting pre-qualified or pre-approved before heading to a dealership gives you an advantage.

Tip 3: Seek Dealership Financing

There are plenty of lenders out there who offer bad credit auto financing, but they are indirect lenders. This means consumers can't directly apply with them for a loan. Instead, these lenders operate through their dealership agents.

Here's a good trick: Head to the biggest dealership in town and apply with them. The large-scale dealerships have the most lending connections and sell the most vehicles. Therefore, it is more likely that they will also have the ability to pull a few strings.

So, while not every dealership is able to work with bad credit, some can. Getting approved is often about finding the dealership with subprime lender connections.

The Bottom Line

Have you tried and been turned away at a dealership? It can be tough to get approved for a car loan when you are dealing with imperfect credit, but it becomes easier when you know who to turn to.

At Auto Credit Express, we want everybody to have the opportunity to get the car they need. That's why we've created a nationwide network of car dealerships that specialize in getting customers with credit problems financed.

We can help if you are having trouble finding a dealership willing to work with you. Best of all, our service is free and it doesn't put you under any obligation. Get started right now by filling out our simple and secure car loan request.