Any advice on getting car financing with crappy credit?

Before I get into explanation, I am getting my wits end with car dealers, so I don't care if you'll never buy a new car or a car built within the last 5 years etc, etc, I need some sound advice. I know people here come from all walks of life so someone has had to have been stuck in a similar situation.

Wife and I have crap credit from a bankruptcy a few years ago. We've been to a few dealers. One straight up said that we were denied, another is giving us the stealership runaround, and one we still haven't heard back from.

We have some money to put down for a down payment, but it seems like unless we drop $10k, we can't get a decent APR and a payment that we can afford. We keep getting told that it's easier to get a new car loan than a used car loan, which I have a hard time believing and can't understand how that's possible.

Also this is a car for my wife and being that we are not small people, we need something that's not a sub $20k econobox. I've found some decent used cars in the upper teens that fit the bill, but once again we hit the financing snag.

Anyone have any advice?

From my experience it is easier to finance a new car than a used one. My wife got her new car easily without a down payment, but her credit had already became decent from the bankruptcy that happened about 8 years prior.

I on the other hand had not had anything in my name since the bankruptcy and walked into the Harley Dealer without a down payment and a very lackluster credit score and rode out on a new bike a year and a half later. I have since refinanced this loan through my credit union and cut the interest rate almost in half. This is still the only thing I have in my name and my credit score has jumped dramatically. Which was the reason I did it. We were planning to buy a house and I didn't want my credit score to be an issue.

Arrange financing first through credit union. They will then say, you can spend $X,xxx on a car not older than xx and your payment will be $xxx per month.
You can then buy from private sellers too like cars found in Cl

I have a friend who he & his wife make about $40k/yr combined gross. They filed for bankruptcy last year(although I don't know the exact reasons why), then turned around 2-months later and bought a '14 Kia. No idea what the price/rate/term was, but the salesman told them there wouldn't be any problems getting financed, and apparently that was true. IIRC I believe it was a dealer in Rantoul or C/U...at the furthest would be Danville. I know it's about 1:30 drive for you, but I can ask what dealer/salesman it was if you'd like?

In reply to petegossett:

Sure, message me on FB with the info.

Easier to finance new cars because they are easier for the bank to be sure about the value of. If you default, the bank gets your car. So if they are going to pay for said car, they need an easy way to know what it is worth. New cars are easier to do that with, and therefore less risky for the bank.

If the dealer can't get you financed, find a new dealer. Period. They are tying to sell a car, and if financing dictates that, then their job depends on getting you financed.

They may not keep your best interests at heart (rates, payment) but they damn well better get you financed if they want your business.

Get the credit union offer in advance. Use it in your back pocket. If the dealer can get you a better deal, consider it. If not, at least you got multiple offers.

rcutclif wrote: Get the credit union offer in advance. Use it in your back pocket. If the dealer can get you a better deal, consider it. If not, at least you got multiple offers.

To add a bit here, it's entirely likely that you can use this to negotiate a better rate than you'd get otherwise. The interest rate is a negotiable value, just like everything else in this crazy process.

I was able to get them to beat my credit union by about .25% with their in house financing on the mazda5 we just bought. I would have went for more, but that already got us down to barely above 2%.

Know that you'll be in the high range going in (10% or more), so plan on refinancing within a year or so.

But yes, you seriously might have better luck new than used.

Have you...hang on, let me get my fire proof gear on... Looked at leasing?

I know it gets a bad rap, but it can also be a way to get lower payments on more expensive vehicle. Depending on the state the taxes get broken up into the monthly payments so less upfront cost, and a chance to improve credit before buying the vehicle at the end of the lease.

It would be worth doing the math to see how much extra it would cost to lease for 2-3 years and then buy at the end of the lease.

I know when I did the math on a Tacoma it was only a couple hundred dollars different when financing a purchase vs leasing and then financing the purchase at the end of the lease.

Have you considered not buying with debt? 3000-4000 will put you in a nice Crown Vic or Minivan. I understand wanting to build your credit but I'm just not sure a $500 payment with a total debt of 25k @ >6% interest is the best way. If you could make do for 6-10 months with what you have and try the $500 payment on for size you could buy a good used larger vehicle with cash.

Otherwise if your going to buy a 20k plus vehicle I think new would work best. I would strongly consider finding the lowest total debt vehicle that will work for you. Leasing is an option but after 3 years of payments you have to do this again. You may have a much better financial situation then an a loan would be available with a low interest rate though and that could keep your monthly payment on a purchase in 3 years near a lease payment today.

We were in the same situation, having filed the big B after '09 gave it to us dry.

At first I avoided any and all loans and credit cards, saving up and paying cash for everything as well as our 'Burban after getting back on track as far as work and pay went. Then we found the Outback and approached our credit union (after a few failed attempts) about getting a loan. It was at 17% interest but we snagged it for $3,000 under nada/blue book and today we're refinancing the loan for 7.5% after suffering through the boning at 17%.

It was a bitter pill to swallow getting saddled with the high interest rate but it's finally paying off. It will suck but it's their game and they make the rules.

What really pissed me off (and still does) was the fact that each failed attempt at a loan hurt our credit more and made it even harder to get a loan, increasing the chances of another failure and worse credit and another failure and worse credit, repeat ad nauseum.

SyntheticBlinkerFluid wrote: Wife and I have crap credit from a bankruptcy a few years ago. We've been to a few dealers. One straight up said that we were denied, another is giving us the stealership runaround, and one we still haven't heard back from.

First thought - if you've got to finance, go to the banks directly, arrange financing BEFORE you walk into the dealership. That way you've got one of the harder parts out of the way, and have fewer chances to have the F&I guy gouge you on the rates.

We have some money to put down for a down payment, but it seems like unless we drop $10k, we can't get a decent APR and a payment that we can afford.

In order to get a loan, you have to first prove that you don't need it...

Seriously, if you've got a half decent down payment, Nocones' suggestion may be a good bet. Putting the half decent down payment on a half decent Crown Vic, or similar, would buy time to save up more for your next car purchase and give you time for the bankruptcy to drop off the credit report.

We keep getting told that it's easier to get a new car loan than a used car loan, which I have a hard time believing and can't understand how that's possible.

Quite possible, due to factory incentives / subsidies on the loans to move new cars.

Also this is a car for my wife and being that we are not small people, we need something that's not a sub $20k econobox. I've found some decent used cars in the upper teens that fit the bill, but once again we hit the financing snag. Anyone have any advice?

Had a look at a Focus? That's one sub $20K econobox that is surprisingly big person friendly. I'm 6'2", and fit in them with no trouble.

I went to a CL that I thought was close to you. I set parameters of cars less than 10 years old and less than $5k. I then hoped I would find some with less than 100k miles or as close as possible.
Banks like cars that are less than 10 years old. They also like less than 100k miles.

I found these:
http://chambana.craigslist.org/cto/5165879650.html

http://chambana.craigslist.org/cto/5169571297.html

http://chambana.craigslist.org/cto/5169263147.html

http://tippecanoe.craigslist.org/cto/5164240507.html

http://tippecanoe.craigslist.org/cto/5169000172.html

Using these examples, visit the Credit Union and see if they will give you a 2 year loan.
On this $5k, if you put $1k down, your payment will be about $200 per month for two years.

Yes, the Elantra may be a little smaller than you WANT but try it. It is a good size still offering signifacant mpg and low maint costs.

Here's what I would do. It's a similar version of what I did to repair my credit score.

1) Become a member of a credit union (I already was one).

2) Talk to a loan officer about wanting to repair your credit and the need for a vehicle.

3) Whatever it takes to get a loan for about $5k or less. Why that much? It's about a $100 payment a month with nothing down.

4) Get a credit card at the same time and use it sparingly to show activity but not enough to break over 10% of your limit per month.

My problem with my score was going years without any credit at all. Everything was cash and I have no mortgage or anything like that. When I started thinking about buying a house a couple years ago it turned out none of the credit reporting orgs were reporting a score. Good luck.

Have you explored the capital one vehicle financing? I've heard a few decent experiences.

Also remember, the more the car is worth, the more your auto insurance will cost.
And, auto insurance rates use your credit score factored into what they charge.
So, before buying in to a brand new lease car, find out how much it will cost per month to insure that car. You may be surprised!

Well I thank you all for giving advice but unfortunately with my wife in the equation, its making things difficult.

She wants a new car or a year old used car. She's the one that's not being realistic, but it's a fight if I try to sway her towards an older car.

I'm going to look into some more things and see what I can find.

I know you.won't do this, but if she's fighting that damn hard- let her do all work. There is absolutely no sense in you getting all twisted over something that she's hell bent on controlling. This is one of those "I told you so" moments. Wait til she burns....."I told you so".

Datsun1500 wrote: You won't get a decent rate, that's part of the penalty for having bad credit, not the dealers fault, the banks fault, etc. You're just going to have to suck it up this time. You need to have better credit to lease (usually) so I wouldn't waste time looking at them. Kia dealers are usually good at getting you into a new Kia, and as someone else said here, Mitsubishi is for when your credit isn't good enough for a Kia. I'd try those. Good rates, low down payment, etc. are for those with better credit, that might be why the dealers are blowing you off, you're not being realistic.

Mitsubishi- when your credit just won't do kia- that was me. The younger suddard male admonished me for that.

As an aside I was looking at a mirage today. It was some sort of eye searing pink. I remember riding back in one from a metal show last fall. They're pentaly boxes to be sure, but they're not that bad. I had room in the back seat.

Kia/Mitsu. If this is for her, and she has the impossible wish list, let her do the work.

get a granny fresh 10-15 year old car for a couple grand... take the money that you'd make in payments every month and save up until you have enough to put a decent down payment on something newer, which will be easier to finance since you'd be paying for most of it with cash up front.

Or do.what I do- accidentally make.friends with everyone then cheap cars fall.into your lap.

My SIL just got a year old soul financed and I'm almost positive they make 40k or less as a household, don't know the details of the financing. I will say she isn't a small person but has no issues with interior space.

I refrain from comments about your marriage and try and help as best I can.

Don't buy into trying to make someone with unrealistic expectations happy.

You will never get satisfaction, because that person will never be happy.

If I may, what do you have for a down payment?

insert snarky comment about woman who recently burned creditors thru bankruptcy "needing" a brand new car