Can You Get 0% Interest on a Used Car?

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Even with poor credit.

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Meghan Carbary has been writing professionally for nearly 20 years. A published journalist in three states, Meghan honed her skills as a feature writer and sports editor. She has now expanded her skill-set into the automotive industry as a content writer for Auto Credit Express, where she contributes to several automotive and auto finance blogs.


, - April 23, 2020

Qualifying for a used car with a 0% interest rate sounds like music to most people's ears. But this type of deal is very rare, and not everyone qualifies even if available. However, now is a good time to get a good deal on a used vehicle, even if your credit's not the best. Many manufacturers are offering deals on used cars in light of the coronavirus pandemic, and one automaker is even offering 0% interest on certain used car models.

One Automaker Is Offering 0% Interest on Used Cars

With the COVID-19 outbreak holding back auto sales in much of the country, carmakers are doing everything they can to entice borrowers to select their brand. Some are even slashing interest rates to 0% APR on some new and used models.

Right now, German automaker Volkswagen is leading the pack in savings, offering consumers 0% APR financing for 60 months on most of their certified pre-owned vehicles. You typically can’t find a 0% interest offer on a used car, making this a unique deal.

VW’s offer is currently the lowest APR deal around for a loan with a 60-month term, even beating out the deals being offered on some automaker’s new models. Other manufacturers advertising 60-month financing deals include Subaru offering 0.99% interest rates, Acura offering 1.49%, and Honda offering 1.99%.

As the coronavirus outbreak continues to impact businesses around the country, we may see additional deals from other automakers in the coming weeks. It’s even possible that other brands may start offering 0% incentive deals on their used car models.

At the same time, if you're already a customer through a captive finance lender and have been financially impacted by the COVID-19 pandemic, you may be able to get help. Many lenders are offering deferment options for those struggling to make their car payments, so contact yours to see what they can do for you if needed.

Getting a Good Deal on Financing as a Bad Credit Borrower

Lower interest rates can save car buyers thousands over the course of their auto loans. As a bad credit borrower, you may not qualify for many of the low interest rate deals being offered right now by automakers.

For example, Volkswagen says that it’s 0% interest deal on certified pre-owned cars is only available to “highly qualified customers.” However, there are lower rates right now than you may have expected to see earlier in the year on some makes and models.

Typically, when you don't have the best credit score, you can expect to qualify for higher auto loan interest rates than borrowers with good credit. According to Experian, people with credit scores below 660 received average interest rates between 10.85% and 19.81% on used vehicles in the fourth quarter of 2019.

In order to get the best deal on the car you need right now as a bad credit borrower, you need to make sure to work with the right kind of lenders. Not all lenders work with poor credit borrowers, and the lenders that can don't work with all dealerships. If you aren't sure where to start, we've got you covered.

No Luck Finding a Car Loan?

The coronavirus situation is causing several automakers to offer great deals. However, as a bad credit borrower, deals like VW's 0% interest rates on used vehicles may not be for you. If you keep getting let down and turned away due to your credit, maybe it's time to work with a different kind of lender.

Here at CarsDirect, we're teamed up with a network of special finance dealers all across the country that have the lending solutions to unique credit situations. Rather than continuing to go out looking for a dealership to help, start here instead. By filling out our simple, fast, and free auto loan request form, we can begin the process of matching you with a local dealer that knows how to help.

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Meghan Carbary has been writing professionally for nearly 20 years. A published journalist in three states, Meghan honed her skills as a feature writer and sports editor. She has now expanded her skill-set into the automotive industry as a content writer for Auto Credit Express, where she contributes to several automotive and auto finance blogs.


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