A lower credit score can change your loan terms, but it doesn't mean you should stop car shopping.
Compare vehicles and financing possibilities
that may match your current situation.
Credit history is an important part of many auto loan decisions in the United States, but lenders may review several other factors before determining which terms are available.
Income, existing financial obligations, the vehicle you choose and the amount you need to finance may all affect the final offer.
Having bad credit does not guarantee approval or rejection. Every lender can use different requirements when reviewing an auto financing application.
A weaker credit profile may affect the APR, interest rate, down payment requirement and other financing conditions.
This means two buyers looking at the same vehicle may receive different loan terms.
The complete application may include information such as:
Yes. The vehicle price directly affects how much money needs to be financed.
Choosing a more affordable model or trim may reduce the loan amount and make it easier to keep the monthly payment within your budget.
U.S. shoppers can compare a wide range of new vehicles depending on dealership inventory and financing availability.
Options may include compact models such as the Toyota Corolla and Honda Civic, sedans such as the Hyundai Elantra, crossovers such as the Chevrolet Equinox, and a variety of SUVs and pickup trucks.
A down payment reduces the amount that needs to be borrowed.
Depending on the lender and applicant, this may influence the loan structure or financing terms that are available.
Comparing financing offers can be especially useful when credit challenges are involved.
One lender may offer a different APR, payment amount, loan term or down payment requirement than another.
Do not judge a financing offer only by the monthly payment.
A longer loan can spread the financed amount across more monthly payments, which may reduce the amount due each month.
However, extending the loan may increase the total amount paid over the life of the financing.
Documentation varies between lenders and dealerships, but you may be asked for:
The auto loan payment is only one part of the cost of owning a vehicle in the United States.
Review the APR, amount financed, payment schedule, loan term, finance charges and total amount you will pay.
Looking at the complete agreement can help you determine whether the financing fits your budget over the entire loan period.
Financing approval and terms vary by lender, dealership, vehicle and applicant. Review all rates, fees and loan conditions before accepting an offer.