Bad Credit Auto Loans

Driving around in a new car is a sought after dream of many people. Buying a new car and driving it home from the lot is an exciting event. Many of us can remember our first car purchase and what a fantastic feeling it gave us! Unfortunately, cars don’t last forever and at some point, it’s time to get a new one.

Whether it’s a new or used vehicle, the process towards buying requires understanding how bad credit auto loans work and knowing which steps to take. Spending the time needed to check out your various options will give you a heads up when walking into a dealership.

By choosing the best bad credit car loans near me, you can then proceed to select the car you want to buy. With funding taken care of, you can spend time focusing on the details of the sale. Negotiate with the dealer for the best possible price on the vehicle you want to buy and feel good about your purchase.

Whatever your credit report is, you can begin your search for car loans for bad credit auto loans now. Go online, send in a loan application and get started with the cash you need for your next vehicle.

Comparing Types of Bad Credit Car Loans

When you’re ready to check out the financing options for your next new or used car, you’ll find that you have many different choices. You might choose the car loan type that is best for you according to:

  • Type of car you want to buy.
  • New car or used car.
  • Credit report.
  • Car loans for bad credit near me.
  • Online lenders.

Online lenders, for instance, are always available, so you can reach out with your loan application any time during the day or at nighttime. You won’t have to wait for an office to open to begin the application process, and you can always expect to get a quick reply.

On the other hand, if you want to get work with direct lenders or through the dealership where you will buy your vehicle, you will need to physically go there. Once you’re at a dealership, a car salesman will help you choose a car and prepare car loans options.

When you’re ready to arranged your car loan, understand the various options so that you can select the loan that fits your situation the best.

Options for Bad Credit Car Loans

Online car loans

For. many people, online auto loans for bad credit can be the easiest and fastest option. You don’t have to leave your home to get started, and it doesn’t matter what time it is. Being able to send in an online loan application during the night and getting a quick reply can be a good solution for anyone in a hurry or doesn’t want to mess with a lot of paperwork required at many financial institutions.

Private seller

Sometimes it’s possible to finance your car directly through the private seller. While this could be risky, it is possible. Instead of getting approval for bad credit auto loans beforehand, you would sign an agreement with the seller to pay the money directly to him. In this case, you must make sure the seller is the legal owner of the vehicle and you can be provided with a free and clear title.

Buy here, pay here

There are dealerships that encourage you to buy your next vehicle from them and let them arrange in house financing for you. While this might seem like the easy way out, be careful to read all the car loan terms carefully. You might be lured into buying a car for an attractive price but then charged a higher interest rate. For someone with poor credit, it can seem like an easy way to get into a new car situation.

Precomputed vs simple interest loans

With precomputed car loans with bad credit, the interest is calculated for the entire length of the term. No matter how much of your loan you have paid off, your payments will remain exactly the same until the end. If you go with a simple interest loan, the monthly payment can be recalculated each month. You will only pay the interest on the remaining balance that you owe, not on the entire loan amount.

Indirect financing for auto loans bad credit

When you approach a dealer and select a car that you are interested in buying, the dealer might be able to arrange the financing for you through a prospective lender. By making these outside arrangements for you, the dealer might add to the interest rate you will be obligated to pay.

New and used car loan offers

There can be differences in the type of loan you get depending on if you are going for a new car or a. used one. New cars are. more valuable, so your loan amount would need to be larger. The loan term would be longer, but you might get a lower interest rate on a new car. The reasoning is that the car is more valuable. If you fail to make your payments, the car can easily be repossessed and sold for a good price. With used car loan offers, you will most likely get a shorter term with higher interest rates. A lender would not give a long term loan on a used car that has already depreciated in value.

Getting Auto Loans with Bad Credit

Not everyone who needs a new car has a good credit report. That’s ok, because there are many options for getting auto loans bad credit. While some options might be easier than others, there are plenty of choices from multiple lenders.

For instance, if you go with secured car loans for people with bad credit, you are offering the car you are purchasing as collateral. In that case, it insures the lender that you will be able to repay the loan. If you are not able to, the lender can simply take possession of your car, sell it and use the money to cover any remaining debts.

Other types of bad credit auto loans are where you have a cosigner. If for any reason you cannot finish paying off your car loan, the cosigner would be obligate to pay. In these cases, the lender is at very low risk because the money will be repaid somehow or another.

Getting Pre Approval for Bad Credit Car Loans

There are many different options you can turn to in getting loan pre approval before you go out shopping. However, what’s important to keep in mind is that whether you’re in the market for motorcycle loans for bad credit or even boat loans for bad credit, you can have more bargaining power if you receive pre approval first.

Many borrowers go about loan approval the other way around. It is possible to go to a dealership and choose the car, boat or motorcycle you want first. Then it is up to you or the lender to find financing options. This can take time and when you finally receive loan approval, the vehicle you first wanted might be gone and you need to begin the process all over again.

If you can spend the time with the application process and getting approval for car loans with bad credit before ever entering the dealership, you’ll be one step ahead. Now you can concentrate on the car you want with the best terms instead of worrying where you’ll get the. money.

With the funding in your pocket, you don’t have to stick with any one dealer. You can feel free to go from dealership to dealership until you find the best vehicle with the most favorable terms.

Narrowing Down Your Vehicle Choices

Once you begin looking at various cars and models, you’ll need to choose one. One of the ways to do that is by using an online loan calculator to see which vehicle you can get with the best loan terms. With online calculators, you can begin by finding out how much you can afford to spend, and then find the best car for that amount of cash.


Using an affordability loan calculator, you can plug in numbers that reveal your financial situation. If you already have a budget that you stick to that’s great. If not, just fill in the blanks the best you can. Begin with the amount of money you earn each month and then subtract all your known monthly expenses and payments. The figure that results should represent how much you have left in your budget each month to cover a car loan payment.

Loan calculator

Besides knowing how much money you have available for a car loan payment each month, you can play with the numbers to find out which vehicle you can qualify for. Put in the sticker price of the car you want and then see what the payments would be. If they are too high, try adjusting to a longer term, or reducing the interest rates being charged. Adding more money to your down payment is another way to reduce monthly payments.

This will give you a starting point with the dealer. Knowing exactly what you can pay and how you can make it work will help you negotiate the selling price and terms with the seller.

Refinancing Your Vehicle with Bad Credit Auto Loans

There can be situations where it makes sense to refinance your present car loan. If you have run the numbers and you think you can get a better loan deal now, there are a few questions to ask yourself before going down that path:

  1. Check out the terms of your current loan. In your loan agreement, you can confirm the interest rate you are paying now, the monthly payment amount and how long the term is. Then check to see if any origination fees are required or if there is a penalty for early loan termination, or prepayment.
  2. Check out your current credit score, to see if it has changed since the time of your car loan. If your credit score is different, or if you owe more debt than before, it could affect your chances of refinancing your vehicle.
  3. Using an auto refinance calculator, find out if you can get a more favorable loan under the current market conditions. Compare your existing car loan with available options to find out if it is worth it for you to refinance your auto loan. You want to look at long term savings before going to the time, trouble and expense of refinancing.

Here are some worthwhile reasons to consider a loan refinance:

  • The possibility of a reduced monthly payment – If you find that you are not able to keep up with. your monthly car payment, a refinance could be the answer. Rather than having your auto repossessed by the seller, see how you can refinance the balance to get easier terms.
  • Getting quick cash back – Some borrowers need emergency cash, so they will look at their car loan. It is possible that the lender can offer immediate cash by reworking your present car loan. This would normally mean extending the loan terms and how much principal will still be owed.
  • Possibility of lower interest rates – If you bought your auto during a period where interest rates were high and they have now come down, you might be able to refinance at the lower rate and save money in interest in the long term.
  • Dissatisfaction with a lender – In some cases, you might find that you want to pull your loan from one lender and find a new one. This could be due to poor customer service, lack of communication or flexibility. Borrowers sometimes prefer to work with online lenders, so they will refinance their loan with a lender on the internet.

Whatever your reasoning for refinancing bad credit auto loans, do your homework first. You might find out that you can save a bundle on a refinance or the opposite could happen. You could leave your current loan too early and get stuck in loan limbo.

Selecting Cars with Bad Credit Auto Loans

Now that you have financing in your pocket, you’re ready to go out car shopping. Since you are not dependent upon the seller for bad credit car loans, you can go to many dealers to get the best terms possible.

Here are some facts to consider when choosing your next vehicle:

  • Fuel economy – When you used an online calculator to determine how much you can afford, did you take into account how much you’ll need to spend on gas? You can’t necessarily judge the car’s fuel demands according to the size of the car. In fact, a new car that is large might be. more efficient than a smaller but older car. Check this carefully or you could be spending too much on gas. You might be better off spending extra on a newer car rather than throwing money into the gas tank each week.
  • Hybrid or electrical vehicles – If your car budget allows for the increased cost of hybrid or electrical cars, you could see substantial savings over the long run. A hybrid car uses a combination of gasoline and an electric motor, whereas an electrical vehicle uses rechargeable batteries, so there is no gasoline expense.
  • Stick shift or automatic – According to most studies, driving a stick shift, or manual transmission, not only gives the driver more control over the vehicle but it can also reduce fuel consumption. Although it can depend on the make and model, cars that depend on automatic transmission generally use more fuel. This is because the motor doesn’t have to work as hard in constantly shifting between gears.
  • Model popularity – How popular or in demand a specific car model is can make a difference in the sticker price. If there is a lot of competition for this specific model, you could end up paying more. Or in another scenario, the seller would be less willing to work with you on the price or terms. Keep in mind that if the model is popular today – it might not hold its value in the future. Try to make your choice that will still have value when you have it paid off.

Contacting Montana Capital Bad Credit Loans

When you’re in the market for a bad credit car loan, we are here to help. Car buyers can find out more auto financing simply by sending us an online application. We offer car financing options regardless of the borrower’s credit history or current credit scores.

Find out about our auto loan rates or auto loan refinancing now, by send us your online inquiry. We will be happy to prepare car loans for people with bad credit quickly and promptly.

We welcome all requests, even from consumers with poor credit scores. We will help bad credit borrowers find the car loan solution that fits their needs. If you are looking for auto refinancing or help with minimum credit score requirements, reach out to us today!

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