Things You Need for Special Auto Financing

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Content Manager

Bethany Hickey is a Content Manager and Writer for Auto Credit Express, CarsDirect, and many other automotive blogs. She's a graduate from the University of Michigan-Flint, with a bachelor’s in English-Writing. 

, Content Manager - July 16, 2020

Special finance departments in dealerships are for many types of borrowers, including new borrowers, those with situational bad credit, and those with a tarnished credit history. While special financing may help you get into your next auto loan, you’re still going to need to prove you can handle it!

How Special Financing Is Done

The process of getting special financing for your next vehicle begins with a credit application. Once you're working with a dealer that has a special finance department, the special finance manager sends your application to one or more subprime (bad credit) lenders.

If you qualify for a car loan with a subprime lender, they set a maximum allowed monthly payment that’s based on your situation. You're also asked to supply documents that prove you meet all of the lender’s requirements.

The items you need to prove the information on your credit application vary by lender. Generally, most subprime lenders require similar proofs – and that’s where we can help.

Commonly Requested Items by Subprime Lenders

Your personal situation may create the need to bring more or less items to the special finance manager for verification. Usually, the things they ask you to get a hold of are pretty easily obtained.

Commonly requested items for special financing include:

  • Proof of income – Proven with a recent computer-generated check stub, showing year-to-date income. You may be required to bring more than one check stub.
  • Proof of residency – Proven with a recent utility bill or recent bank statement in your name.
  • Proof of identity – Proven with a valid driver’s license, meaning that it's not revoked, suspended, or expired.
  • Proof of a working phone – Proven with a recent phone bill in your name.

There are some situations that may require you to bring more items, and it also depends on how you’re applying. For example, if you’re asking a cosigner to sign the auto loan with you (which can increase your chances of approval), the lender is going to want their information along with yours.

Another example could be if you just got discharged from bankruptcy. Since it can take a while for a bankruptcy discharge to appear on your credit reports, lenders may ask you to bring your discharge papers.

Additional Items to Gather for Special Financing

There is another large item you’re going to need to prepare for: a down payment. If you have a lower credit score, it typically means you’re going to need a down payment to be approved for special financing.

The minimum amount required varies, but you can expect to need at least $1,000 or 10% of the car’s selling price. Your lender is going to ask for a minimum amount, but there’s nothing stopping you from putting down more cash than required! You can put down as much as you want, and even use an equity trade-in to help cover the down payment requirement.

If you’re eligible for auto financing, your subprime lender is also likely to ask for a list of five to eight personal references. These references can be pretty much anyone, as long as they don’t live with you. The references need to have complete contact information listed including their phone number, address, email, etc.

These can take some time to gather, so it’s best to have them prepared before you head to the dealership. Be sure to ask for permission to list them as a reference!

Getting in Touch With a Special Financing Dealership

Gathering your things to prepare for a car loan can take some time. If you’re prepared and know where to start, it can make the special financing process less stressful.

Finding a bad credit auto lender can also be streamlined if you work with us! Here at CarsDirect, we have a coast-to-coast network of dealers that have special finance departments. Instead of driving all over town looking for a dealership that can work with your credit, fill out our free car loan request form, and we’ll do the searching for you.


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, Content Manager

Bethany Hickey is a Content Manager and Writer for Auto Credit Express, CarsDirect, and many other automotive blogs. She's a graduate from the University of Michigan-Flint, with a bachelor’s in English-Writing. 

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