Can You Get a New Car with Low Monthly Payments with Bad Credit?

Get Car Financing
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.


, - February 27, 2019

When you struggle with bad credit, you may think you're doomed to an existence of high mileage clunkers or cars with outdated technology and old-fashioned safety features. But did you know that a new vehicle may not be out of reach even with low credit scores? Low monthly payments, however, might depend on your perspective.

Not all Car Payments are Created Equal

Let's face it: nobody wants to pay a lot of money for an auto loan, especially car buyers with bad credit. Getting the lowest price possible on a vehicle should always be your goal; however, the lowest possible price isn't the same for everyone. This can be largely due to the interest rate you qualify for. Interest rates are based on credit scores, so it's possible that two people can finance the same type of vehicle at the same negotiated price and still end up paying different amounts.

Auto Loan Terms and Monthly Payments

Another factor that determines how much your monthly car payment ends up being is your loan term. To get the lowest monthly payment on loan term alone, you’d want your loan length to be as long as possible. This means stretching a loan out over 72, 84, or even 96 months.

But do you really want to pay an auto loan for eight years (96 months)? A lot can happen to a vehicle in that amount of time. Not to mention all the extra interest charges that accrue over the loan term. That’s right, the longer your loan is, the more you’re going to end up paying, and sometimes a low monthly payment isn’t worth the extra cost.

Getting Your Lowest Possible Car Payment

Obviously, you want to get the lowest possible payment you can when you're financing a new car. If you know that your credit isn't the best, how do you ensure you’re getting the best rate? There are a few tips you can use to make sure you get the best deal possible on your next new vehicle purchase – good credit or not.

Here are four things you can do to get your best rate:

  • Know your credit – If you don't know your credit score and what's on your credit reports before you head to a dealership, you run the risk of letting someone else determine it for you. If you know what your FICO score is and what your reports show, you can research the interest rates that are common for people in similar situations, and no one can pull the wool over your eyes by selling you on an unrealistic interest rate. If they try, walk away and find a fair deal.
  • Know what you can negotiate – Some things in car buying are set in stone, but others aren't. Make sure you know what you can barter on to get the best price possible. Sale price, add-ons, documentation fees, and some other dealer fees are negotiable, so stand your ground when you talk price.
  • Save money up front – Did you know that a bigger down payment saves you money down the road? It's true. Making a large down payment – think around 20 percent of the vehicle's selling price – not only helps you save in interest charges, it gets you out of the negative equity zone quicker. Down payments can be made in cash, trade-in equity, or a combination of both.
  • Shop for a reasonably priced vehicle – Last but certainly not least, when you have bad credit, it isn’t the time to finance your dream car. It’s possible to drive a new vehicle at a lower monthly payment if you skip all the bells and whistles of higher trim levels and stick to a base model that meets your needs. Look for a car that has a good reliability rating, and that’s fuel efficient, because gas and repairs are part of the total cost of owning a vehicle, too. Here at CarsDirect, you can find new cars by monthly payment in our New Car Deals section. This lists up-to-date auto specials that are curated monthly, and it can help you get started researching your next new vehicle with low monthly payments.

Working with the Right Lenders

Lastly, one of the best ways to ensure you can get the car loan you need when you have bad credit is by working with the right lender. Not all lenders can handle bad credit buyers, and those that can aren't always easy to find. But here at CarsDirect, we know how to connect you to a dealership that works with the lenders you need.

Our nationwide network of special finance dealers has the lending specialists to help people in many types of credit situations. We can help you by making your search for a lender hassle free – just fill out our free, easy, and no-obligation auto loan request form, and we'll get the process started right away!

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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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