Does it Hurt My Credit to Apply for a Special Financing Car Loan?

Get Car Financing
Even with poor credit.

By

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.


, - July 8, 2020

Anytime you apply for new credit, a lender reviews your credit reports, which can lower your credit score slightly. This doesn't mean you should stop applying for credit, but you should know when and how to do so that your credit can easily bounce back. This is especially true if you're looking for a special financing car loan when you already have damaged credit.

Does it Hurt to Look at Credit?

Your credit score can drop a little depending on who's looking at your credit reports, and when the last time someone else looked at them was. There are two types of credit "pulls" that could happen when your credit reports and score are requested from one of the major credit bureaus.

It doesn't matter if you're applying for a car loan or a credit card; if you ask for credit without it being offered to you first, this is considered a "hard pull" or "hard inquiry." These can make your credit score dip anywhere from five to 15 points on average, but the drop doesn't typically last.

If you're offered credit (those credit card offers you may get in the mail), but haven't applied for it, or if you just want to know your credit score or what's on your own credit reports, these are "soft pulls" or "soft inquiries," which don't affect your credit score.

Avoid Hurting Your Credit More

When you need credit, a good way to go about getting it without bringing down your credit score unnecessarily is rate shopping. Rate shopping is when you apply for the same type of credit with multiple lenders in a short period of time, typically 14 days.

When you do this, the credit bureaus and credit scoring models recognize that you're looking for something specific. If you stick with the 14-day window, all hard pulls made for the same type of credit only count against your credit score as if they were one single hard inquiry. This allows you to shop for the best interest rate or deal available to you with your credit score taking a dive.

Rate shopping can sometimes be a bit easier with better credit, because there are generally more auto loan options to choose from. As a bad credit borrower, it's possible to rate shop, but you may find a smaller pool to fish for deals in.

Skip the Hassle of Shopping Around

If you're not having any luck finding a lender to rate shop with, you can skip the hassle and let us match you to a local dealership instead. We aren’t a lender, but we look for a dealer with the lending options you need!

Here at CarsDirect, we're teamed up with a nationwide network of special finance dealerships that are signed up with lenders that work with all kinds of credit situations. These subprime lenders may be just the ticket to getting the auto loan you're searching for.

Our process is fast, free, and there's never any obligation to buy, so don't wait any longer – fill out our car loan request form today! Again, if you're having trouble finding a dealer that can work with your credit situation, let us help get you on the path toward a special financing auto loan.

Free Credit Score

Get your free credit score now! Get a copy of your most recent credit score.

Get Your Free Score

Auto Insurance

Get competitive quotes on insurance in your area.

Sell Your Car

We will buy any car, running or not, with or (in most cases) without the title.

Get My Price

Need a Car Loan?

It only takes a minute.

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.


Search New Cars by Loan Payment »

View estimated loan payments based on local rebates and financing offers.

Loan approval is not guaranteed and is subject to credit application and approval of the lender. Individual loan terms may vary. Use of this website constitutes acceptance of CarsDirect.com's Terms of Use, Disclaimer, Privacy Policy, and Cookie Policy.

Privacy Policy|Do Not Sell My Personal Information|Terms of Use|Cookie Policy|Disclaimer
COPYRIGHT 1999-2020 MH Sub I, LLC dba CarsDirect.com