You may be surprised to find that even people with poor credit can finance a new car if they're working with the right type of lender and qualify. However, a new vehicle may not be in your best interest as a bad credit borrower.

Choosing Your Vehicle

What Kind of Car Can I Get With Bad Credit?Depending on your situation, you can qualify for any vehicle – new or used – that fits within your monthly payment range. But car choice doesn't come first when buying a vehicle with bad credit. Instead, you have to qualify for an auto loan, and once you’ve been approved, the dealer shows you what they have in stock that you qualify for.

Make sure that you know what your driving needs are before you start the process, so you don't end up with a flashy sedan when what you really need is a midsize SUV.

Research your options and see which cars have the features you're looking for, but don't settle on one vehicle. One good tip is to make a list of must-haves and a list of deal breakers. Remember, picking out your car doesn't come first, so it pays to be flexible and realistic with your choices.

You typically have three options to choose from when it comes to vehicle type as a bad credit borrower:

  1. New – Believe it or not, you may be able to qualify for an affordable new car depending on your situation. New vehicles are typically more expensive than used cars, but may not require as much maintenance as a used vehicle.
  2. Used – Used cars tend to be more budget friendly for bad credit borrowers than most new vehicles. They may also require more upkeep, too. However, if you find an affordable, reliable used car that's in good condition and holds its value, this could be just what you're looking for.
  3. Certified pre-owned – Certified pre-owned (CPO) vehicles are a good middle ground between new and used cars. Typically, CPO vehicles are off-lease or newer used models that have been well cared for, and have fewer miles than a standard used car. These vehicles go through an inspection with a manufacturer-certified mechanic, are refurbished to automaker standards, and come with some type of manufacturer-backed warranty to help cover certain repairs for a set period of time or number of miles. CPO cars are typically more expensive than regular used vehicles, but may come with more of the safety and technology features you’re looking for. They can also save you thousands over a new car.

Car Choice for Bad Credit Borrowers

Choosing a car is often one of the first things people do when they're shopping for a vehicle. However, when you have bad credit, it's not as easy picking out a car and getting pre-approval for a direct loan from a traditional lender. Instead, vehicle choice comes near the end of the bad credit auto loan process.

First, you need to find the right lender to work with your credit situation and qualify for financing. This means meeting the lender requirements, and bringing documents to the dealership that prove the information you provide on your application.

Once you're approved, the lender sends the dealer a payment call that tells them your maximum monthly payment and interest rate tier. You then find out which cars the dealership has in stock that fit your budget. If you already have your heart set on a vehicle, you're only going to be disappointed if it isn't eligible. However, if you're flexible, your dealer can help you find the right fit for you.

Finding the Dealership You Need

Not all lenders work with people that have less than perfect credit. But those that do, called subprime lenders, only offer loans through special finance dealerships. If you're not sure which dealers cater to customers like you, don't risk driving from dealership to dealership getting turned down. Start at Drivers Lane instead.

We're teamed up with a nationwide network of special finance dealers that have the lenders you need to get a bad credit auto loan. Getting started is easy – just fill out our fast and free car loan request form, and we'll get to work finding a local dealership for you!