Many Americans rely on vehicles to get them around, and financing one can be costly – especially if you have bad credit. If your income is low compared to an average household of your size and you also have bad credit, you may still be able to get approved for financing. Let us share some tips with you on how you can get a car loan as a low income earner.

How to Qualify for a Car Loan with Low Income

Car Loans for Low Income EarnersWhen you have bad credit and a low income, you should first try for pre-approval from your bank or credit union. If they turn you down, the next step is to find a special finance dealership or buy here pay here dealer.

Each is going to have different income requirements, but the subprime lenders that work with special finance dealerships typically ask for a minimum monthly income of $1,500 to $2,000 before taxes from a single source. The minimum income requirement can vary more widely at buy here pay here lots.

With that in mind, these four tips can help low income earners get an auto loan:

  1. Research vehicles – Check out what the models you’re interested in cost, and find out what both owners and experts like or don’t like about them. Make sure to look up safety ratings and any recalls, too.
  2. Have a budget – While looking up different cars, you should be considering a budget. Using our Auto Loan Monthly Payment Calculator, you can get an estimate of how much you're going to pay each month. Note that the calculation doesn’t include insurance, tax, title, and license fees, so make sure you factor those estimates in.
  3. Save up for a down payment – You usually need a down payment to get approved for a bad credit car loan, and the bigger the better. Most subprime lenders ask for a minimum down payment of $1,000 or 10 percent of the vehicle’s selling price, whichever is less.
  4. Consider a co-borrower – If income is an issue, you may want to consider adding your spouse as a co-borrower on the loan. You can combine incomes with a co-borrower that's a spouse, which can help you qualify when you wouldn't be able to on your own, and possibly even unlock access to better terms and rates.

Other Car Buying Options with Low Income

What if you know you can’t qualify for an auto loan through a subprime lender? You're going to have a more difficult time finding financing, but all hope isn’t lost, since it now depends on your income situation.

If this is the case, what you can do is research your state’s assistance programs and grants that provide funding for families that need a car. You can also look into programs that give donated vehicles to those who don’t have the money to buy one on their own due to disability, unemployment, or low income.

Let Us Help You Find a Dealer to Work With

If you’re not sure if you have enough income to qualify for an auto loan, or you just haven’t found the right dealer to work with, we want to help you.

Auto Credit Express helps people find financing with our nationwide network of special finance car dealerships. Our partner dealers are experts at helping consumers in unique situations, such as low income earners or those with bad credit.

We'll work to match you with a dealership near you if you start the process by filling out our free and fast auto loan request form.