Many people living in the greater Los Angeles area rely on a vehicle to get them to and from work, as well as their other everyday tasks. If you need to buy a car in Los Angeles when you have no credit, or bad credit, you can still get auto financing. The key is to work with the right lenders – but first you need to know where to find them and what their requirements are.
Where to Get Bad Credit Auto Financing
Not all dealerships offer no credit or bad credit financing in Los Angeles, and not all banks and credit unions can offer pre-approval to those with limited or poor credit. You should still try to get pre-approved, especially if you have a good relationship with your current bank or credit union.
If you’re turned down, your next options are to find a special finance dealer or a buy here pay here (BHPH) dealership. Both extend bad credit car loans to those with less than perfect credit, but they aren’t the same.
Special finance dealers work with subprime lenders. These lenders extend financing to borrowers with credit issues. They look at your credit score and credit reports, but also look at other factors such as income, employment, residence stability, and more.
BHPH dealerships, on the other hand, are both the lender and the dealer. You can buy a vehicle and get approved for financing at the same place. Unless they state otherwise, these dealerships don’t run credit checks, and, instead, base approvals on income and down payment. The downside to this is that if they don’t check your credit, they typically don’t report loans or timely payments to the credit bureaus, so your credit score isn’t going to improve.
Requirements for Car Financing with No Credit in LA
Just what does it take to get an auto loan when you have no credit? First, it depends on the type of lender you’re working with.
Subprime lenders like to see a credit score, but some may accept consumers with no credit history. If they do, most of the time they ask that you have a cosigner on the loan. A cosigner helps those with little to no credit get approved by letting them "borrow" their good credit.
Your potential cosigner must meet the basic cosigner requirements, including having good credit and enough income to individually support your car loan. Not only can a cosigner help you get approved for financing, but there's a chance you could get a better interest rate by having them on the loan.
When financing a vehicle with no credit at a BHPH dealer, you shouldn't have a problem getting approved as long as you meet their income and down payment requirements. However, it’s tough to say just how large of a down payment you're going to need because it depends on the price of the car you choose.
As for income, the amount they require varies by dealer. As a reference point, subprime lenders generally require a minimum monthly income of $1,500 to $2,000 a month before taxes. Many BHPH dealerships base their income requirement around this model, as well.
Let Us Help You Get Connected to a Dealership
No matter where in Los Angeles you live, Auto Credit Express wants to match you to a nearby dealer. We help consumers with no credit, bad credit, and other credit issues find financing thanks to our nationwide network of special finance dealerships.
In LA, starting the process of getting matched to a local dealer is simple. All you have to do is fill out our secure and free auto loan request form, and we’ll get right to work for you!