Zero down car loans sound like a great thing, but the truth is, qualifying for a loan with no money down can be difficult. Ultimately, it may not even be worth the perceived savings.

Behind the 0% Down Advertising

Can a 0% Down Payment Car Loan Help You?It’s not uncommon to hear zero down advertising from a local auto dealer on TV and radio ads – they pop-up every day in some places. But, before you jump at the chance to go grab a vehicle and expect to put nothing down, you need to know the fine print behind these deals.

If an advertisement says that you may qualify for a zero down car loan, know that the goal is to get people in the door. The more people that come in to shop for a vehicle, the more likely dealerships are to make sales. Out of those people that come into the dealership, the only ones actually qualifying for a special like a zero down auto loan are buyers with good to excellent credit.

If your credit is less than perfect, however, it’s not impossible for you to get a zero down car loan, but it is very rare. If you’re lucky enough to qualify for zero down, the loan is likely to come with a high interest rate, which may end up costing you more than you save by not needing a down payment.

Getting an Auto Loan with Less than Perfect Credit

If you're someone with poor credit, it's more likely that you’re better served getting financing from a special finance dealer that works with subprime lenders. These types of lenders don’t typically offer zero down financing, but what they can do is get you into a vehicle you need, even if you have bad credit, no credit, bankruptcy, or a past repossession.

In order to reduce the risk involved with lending to people with less than perfect credit, subprime lenders require certain qualifications to be met for a loan approval. These qualifications vary by lender and situation, but they typically require:

  • A minimum income
  • An employment requirement
  • A residency requirement
  • A down payment
  • Proof of a working telephone
  • Personal references

The Bottom Line

Getting a zero down auto loan might sound like a good idea, but, in reality, it’s not likely to save you any money if you’re dealing with bad credit. Rather than searching for a zero down car loan you may not even qualify for, why not apply with a special finance dealer that has the lenders that can get you approved for the financing you deserve?

Here at Drivers Lane, we take the guesswork out of finding a dealership. We work with a coast-to-coast network of special finance dealers that have lender that can help. Get started right now by filling out our easy online auto loan request form.