Bad Credit Auto Loans and Disability Income

Individuals with bad credit who receive disability or SSI income could find that this complicates matters when attempting to qualify for auto loans for bad credit

In our experience

If you’re sure you have bad credit you may be wondering if you still qualify for a bad credit car loan if all or a portion of your income comes from disability or SSI payments. We know, because for over two decades Auto Credit Express has been working with bad credit customers and helping them reestablish their car credit.

In fact, after seeing the embarrassment and disappointment that customers with bad credit often face, we rolled out a web site that helps educate customers. It also features a bad credit auto loan application. We then match applicants with dealerships in their area that specialize in customer credit issues.

The alternative, which means buying a vehicle from a tote the note car dealership, is another option for bad credit customers, but most of these dealers don’t report payments to the credit bureaus. In the end, this means that person’s car credit is not reestablished and their credit scores will not get better because of this – not to mention the fact that a higher percentage of these loans result in repossession.

But if all or a portion of your income comes from disability or SSI payments, will a bad credit lender other than a buy here pay here dealer even consider your application?

SSI and disability income

Its difficult enough getting approved for a regular car loan if all or some your income comes from disability or SSI payments and it’s even harder if you’re trying to get approved for a bad credit auto loan. Here’s why: disability and SSI income, like child support, cannot be garnished. This means that if a borrower with disability or SSI income has a vehicle repossessed, the lender will be unable to get a court order to garnish that income in order to pay off the loan balance.

In this case, lenders are especially cautious when considering bad credit applicants with either type of income. Even so, there are a few situations where a typical lender might consider this type of income:

•    If there is other income, in addition to disability and SSI, that could be garnished. An example would be W-2 wage income from a job (the longer the job time and the higher this additional income is, the better chance you have of getting approved).
•    Other factors that might help include long-term residence stability and if your bad credit is “situational” instead of “habitual” (where current bad credit stems from a single cause, such as a medical issue, job loss or foreclosure, as opposed to a history of often having paid your bills late).

One more important point: if you are claiming either disability or SSI income, you need proof. In this instance, that means you will need to provide the original award letter that stipulates the amount and duration of the support payments, as well as any additional proof, such as bank statements, that those payments are ongoing.

The Bottom Line

SSI and disability income can be a problem with any auto loan, but both can be an even bigger issue if you’re hoping to get approved for car loans with bad credit. To give yourself a better chance, be sure to have the proper documentation with you when you visit the dealer for the first time.

At Auto Credit Express, we specialize in placing customers with bad credit with dealers that can help them. Our affiliate dealers are knowledgeable and work with a broad spectrum of lenders to ensure you have your best chance at getting approved for a car loan.

So if you are serious about getting your car credit back on track, you can begin a new chapter in your life by filling out our bad credit car loan application now.

Posted on November 13, 2010 by in Auto Loans, Bad Credit
Reader Comments

3 Responses to Bad Credit Auto Loans and Disability Income

  1. Pingback: Tweets that mention Bad Credit Auto Loans and Disability Income | Auto Credit Express Auto Loan Blog --

  2. LaVerne says:

    My sister bought a 2010 Dodge Ram at a car dealership and she has had the truck for 3 weeks. They took are down payment of 3000.00 and she got full coverage insurance all this and now they called and said the company that was to finance her will not. No explanation. Just asking her to bring her truck back. We would like to know what we need to do to see if you could finance her.

    Any assistance you could provide would be greatly appreciated.

    Thanks, LaVerne

  3. Steve Cypher says:


    To begin with, we aren’t a lender. We have a nationwide network of dealers that work with a broad range of lenders that help buyers in all credit situations. Unfortunately, they wouldn’t be able to help your sister since she took possession of this vehicle from another dealer.

    With that being said, it sounds like your sister left the dealership after signing a document that stated that if the dealer couldn’t get her financed she would need to bring the truck back. I understand she had to get insurance and she gave them a down payment of $3,000, but at this point in time, her only choice would be to return the truck and get her down payment back.

    Once that happens, she can apply online at our web site (

Apply Online Apply on Phone Search