Can I Get a Car Loan Under $10,000 With Poor Credit?

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Even with poor credit.

By

Contributing Writer

Bethany Hickey is a graduate from the University of Michigan-Flint, with a bachelor’s in English-Writing. She is a content writer for Auto Credit Express, CarsDirect, and many other automotive blogs, as well as the Poetry Editor for UM-Flint’s writing magazine.


, Contributing Writer - June 8, 2021

When you have poor credit, it may limit what you can finance and how much you can finance. Additionally, many traditional lenders may not approve you if your credit score is worse for wear. However, financing a vehicle that costs less than $10,000 is possible if you qualify for a car loan with a subprime lender.

How Much Can I Finance With Poor Credit?

The amount you can finance for a vehicle largely depends on your individual situation – everyone’s circumstances are different. While we aren’t able to tell you exactly what you qualify for – we aren't a lender – we can tell you what a subprime car loan is likely to entail, and help you calculate an estimate of how much loan you can afford.

Subprime lenders specialize in assisting borrowers with less than perfect credit. They often work with borrowers that have gone through bankruptcy, had a past repossession, or just poor credit situations in general. Consumers with credit scores under 660 are generally considered to be in the bad credit range, and if a traditional auto loan isn’t in the cards for you right now, then a subprime lender could be your next step.

For the most part, subprime lenders have these stipulations when it comes to vehicles:

  • You finance at least $5,000 (including taxes, dealer fees, and add-ons)
  • The vehicle is less than 10 years old
  • The car has less than 100,000 miles
  • Vehicle is typically required to have a clean title
  • You have a down payment of at least $1,000 or 10% of the car’s selling price

This doesn’t necessarily mean you have to purchase a $5,000 vehicle, though. A less expensive car could still be eligible for financing if the taxes, dealer fees, and other add-ons could push the total to the typical $5,000 minimum or more.

Since most subprime lenders require you to finance at least $5,000, then finding a vehicle with a total finance amount higher than $5,000 but under $10,000 is an option if you want to pursue it. However, you’re likely to need a used vehicle if you want one under 10K, given that brand new cars tend to hover around $40,000 nowadays.

Auto lenders generally prefer to approve financing for vehicles that are a good investment. This means subprime borrowers can have a higher chance of getting an approval if they choose a car that’s in good condition, has low mileage, and hits a certain price point.

The Subprime Timeline

It’s important to note that the subprime shopping process is a little different from a traditional good credit borrower's experience. In most every case, the special financing process requires you to be approved first before you choose a vehicle.

Subprime lenders are signed up with special finance dealerships. You submit your application with the assistance of the special finance manager on-site at the dealership, who sends it along to their lending partner(s). If you’re approved, you’re told the maximum car payment you qualify for. From there, you choose a car that fits your situation, has a car payment you qualify for, and meets the lender’s vehicle’s stipulations.

The typical subprime auto loan timeline goes like this:

  1. Find a special finance dealership
  2. Apply for financing with the help of a special finance manager
  3. Lender determines eligibility for the car loan
  4. If approved, choose a vehicle and make a down payment
  5. Take delivery

In order to get approved for a subprime auto loan, you typically need to meet a number of qualifications that show the lender you have the ability, stability, and willingness to take on auto financing. Not only can we help guide you toward a dealership that has the lending you need, but we can also give you tips and tricks on increasing your approval chances for your next auto loan.

Finding a Special Finance Dealership

Getting approved for a subprime car loan starts with finding a dealer that’s signed up with subprime lenders. If you want to skip the hassle of looking for a dealership, then start with us, right here at CarsDirect!

Over the last 20 years, we’ve accumulated a nationwide network of special finance dealerships that are signed up with subprime lenders that assist bad credit borrowers. Get started on the path to your next car loan by filling out our free auto loan request form.

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, Contributing Writer

Bethany Hickey is a graduate from the University of Michigan-Flint, with a bachelor’s in English-Writing. She is a content writer for Auto Credit Express, CarsDirect, and many other automotive blogs, as well as the Poetry Editor for UM-Flint’s writing magazine.


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