A down payment helps you finance a vehicle in Los Angeles by showing lenders you’re willing to invest your own money in a car loan. This is called having some "skin in the game” and the more you have, the better your chances could be for an auto loan approval.

How a Down Payment Helps

How Does a Down Payment Help Me Finance a Vehicle in Los Angeles?A down payment not only shows lenders your willingness to invest in your loan, it helps you save money. The larger the down payment you make, the less you have to borrow. This results in a lower overall cost, as it reduces the interest charges over your loan term.

Another benefit of using a down payment to help you get an auto loan in the City of Angels is that a down payment can reduce the time your vehicle spends with negative equity. Most borrowers experience negative equity at some point during their car loans, but the larger the down payment, the shorter the amount of time you generally have it.

How Large of a Down Payment Do I Need?

Many borrowers are often looking for a lower down payment requirement, which could leave them searching in vain all over Los Angeles. Zero down deals and low down payments are usually reserved for people with the best credit.

When you’re struggling with your credit, making a small down payment hurts you, because you’re going to pay more in interest charges. Bad credit borrowers typically only qualify for loans with higher interest rates to begin with, and the more you borrow, the more you’re charged. This makes zero down or low down payment options a losing battle if you have poor credit.

Because vehicles are getting more and more expensive, the more money you can put down, the better. However, because a down payment can be difficult to come up with if you’re already struggling with bad credit, most lenders have a minimum down payment requirement in place.

As a bad credit borrower working with a special finance dealership in LA, lenders typically require you to make a down payment of at least $1,000 or 10% of the car’s selling price.

Even with this requirement in place, keep in mind that the bigger the down payment you can make, the more money you save and the faster you can eliminate negative equity. If you can afford to, you're only helping yourself out by making a larger down payment.

Get a Car Loan from the Right Dealership

If you’re looking for help getting an auto loan approval in Los Angeles, consider making the largest down payment you can afford if you have poor credit. When you prove to a lender that you’re willing to invest in your own success, you’re likely to have a better chance of getting approved – as long as you meet the other lending requirements.

Another way to increase your chances of approval is to work with the right type of lender for your situation. When that situation is bad credit, make sure you’re working with a special finance dealer that has lenders available to help people that are struggling with credit issues.

At Auto Credit Express, we know that these dealerships can be difficult to distinguish from traditional dealers, but you can save yourself the hassle of driving all over LA by filling out our fast and free car loan request form. Once you do, we’ll work to connect you to a dealership near you. Don’t delay, get started right now!