Financing a Used Car with Bad Credit
If you're currently in the process of rebuilding your credit, you might be wondering whether it's possible to finance a used car. Here at Faulkner Automotive Group, our finance pros have helped thousands of drivers with less-than-stellar credit secure terms that fit their lifestyle and budget.
We believe shopping for a quality used car should be an exciting and easy experience. That's why we've created this helpful guide to financing.
Continue reading before visiting one of our dealerships throughout Harrisburg, Mechanicsburg, and Trevose today!
How Do I Finance a Used Car With Bad Credit?
While our finance center team enjoys long-standing relationships with local lenders, there are things you can do to put yourself in the best possible situation. Perhaps the most important thing is to know your credit score before visiting our showroom.
There are several third-party websites you can consult, like Experian or Equifax, to access your current credit score. These sites will give you the most accurate and up-to-date scores along with tips on how to improve your numbers.
If your score is currently lower than you'd like, think about increasing your down payment amount. You can also request to shorten the length of your auto loan. While this will increase your monthly payment, it can often persuade the lender to approve your request. It might even lower your interest rate!
One final tactic: Find a co-signer. Ideally, you'll want to choose someone with good to excellent credit. They should also be someone you trust, like a family member or a close friend.
Why Is My Credit Score So Important?
Think of your credit score like a financial snapshot. Based on a range of 300 to 850, this number helps lenders determine your ability to take on and manage debt.
To secure the best interest rates, you'll want to maintain a credit score above 700. The higher your score, the easier you'll be able to access the best terms for your auto loan. If your current credit score is below 700, it's still possible to finance a used car, though you can expect to pay a little more each month.
Your credit score can be broken down into five key areas, including:
- Payment History - Do you pay your bills on time? Is your credit report free from late payments or delinquencies?
- Credit Utilization - Do you carry a high balance on your credit cards? Ideally, you'll want to keep your credit balance below 30% of your total limit.
- Credit History - This most often affects younger drivers and people who have limited experience using credit. On the other hand, a long credit history only bolsters your overall score.
- Mix of Credit - While student loans or mortgage costs don't typically harm your ability to secure an auto loan, a large amount of credit card debt can often push your score lower.
- Recent Applications - Each application that requires a hard inquiry into your credit can deduct a few points off your score.
Your Best Ally: Our Friendly Finance Center Team!
At Faulkner Automotive Group, we understand the importance of driving a reliable used car. That's why we staff our finance centers with experienced and hard-working pros who'll do everything to help secure the right loan for you.
If you're ready to hit the streets of Harrisburg, Mechanicsburg, and Trevose in style, visit our local dealership near you to get started!