Do Car Dealers Only Look at Your Credit Score?

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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.


, - November 19, 2020

Getting an auto loan certainly means that a car dealer, or, more specifically, the lenders they're signed up with, are looking at your credit score. Whether or not that's the only thing they base your auto loan eligibility on, though, depends on the type of lender they are. When it comes to bad credit car loans, your credit score is only one piece of the puzzle.

Bad Credit Auto Loans and Your Credit Score

It's not only your credit score that gets looked at when you visit a dealership for an auto loan. Lenders that work with credit-challenged consumers know that there's more to a person than a three-digit number. For this reason, they use more than just your credit score to ensure you qualify for financing.

These subprime lenders use factors that show them your ability, stability, and willingness to take on a car loan:

  • Ability – To be able to take on an auto loan, lenders have to be sure you can repay it. To see if you can, they evaluate if you’re able to continue to make your payments over the whole loan term using your income, employment, debt to income ratio (which tells them how much of your income is already being used by existing bills), and more.
  • Stability – Is your income likely to last through the end of your loan term? This is what lenders want to know when they're looking at your employment and residence stability. The longer you've lived and worked in the same area, or for the same company or type of job, the better you generally look to a car lender.
  • Willingness to pay – Otherwise known as a down payment, this factor comes down to how much skin you're willing to put in the game. When you need a bad credit auto loan, a down payment is always a requirement.

Subprime Lenders Can Help

The lenders that concentrate on more than your credit score are called subprime lenders. A low credit score can stand in your way when it comes to getting a car loan with a traditional auto lender such as a bank, credit union, or some captive lenders, but not with subprime lenders!

In order to ensure that you can handle the loan, subprime lenders require you to bring documentation with you to a dealer to prove you meet the qualifications. The finance manager at the dealership acts as the go-between with you and the lender, you don't actually meet with a lender. Though the documents can vary, most subprime lenders require:

  • Proof of income
  • Proof of residency
  • Proof of a working phone
  • A valid driver's license
  • Five to eight personal references
  • A down payment

It's a good idea to have all these things in order before you take your first trip to a dealer. The more you can gather and prepare, the better your chances of getting into a car loan that much quicker.

Ready to Find Your Next Car Loan?

When you need an auto loan and you don't have a good credit score, the dealership you go to isn't concerned about your credit score, but a car lender is. Not all dealers are signed up with the same type of lenders. This means that if you need a lender that's concerned with more than just your credit score, you have to be sure to find the right kind of dealership.

If you're ready to get started with your next auto loan, start right here at CarsDirect. We've gathered a coast-to-coast network of special finance dealers that are signed up with subprime lenders. These lenders rely on more than only your credit score, which makes it easier to find the financing you need. Let us put you on the path toward a car loan today. Just fill out our fast, free, and no-obligation auto loan request form.

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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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