The first step to buying a car


With the rising cost of new vehicles, many people don’t have the cash on hand to buy a car. This often means that they still have to finance a vehicle. However, before you can do that, there is an important step you need to take: find out where your credit is.

Know your credit situation

The first step in buying a car is to know your credit score and what’s on your credit reports. Without this information, you are leaving all the power in the hands of the dealers and lenders.

When you know where you are at, you have the knowledge to plan your car buying experience around what you are likely to qualify for. The alternative is to be disappointed if you are unable to qualify for the vehicle, rates, or terms you were hoping to get.

Why is checking your credit the first step?

It is important to know where you stand so that you can determine what you can realistically claim as a borrower. Not all lenders can work with people whose credit is less than perfect. If your credit isn’t up to par, you risk being rejected by going to bad lenders.

Your credit score and the content of your credit reports determine how you can buy a car loan. With good credit, the world is your car buying oyster – you’ll probably have an easier time getting the financing you need from a variety of lenders.

Generally, the higher your credit score, the more likely you are to get the auto loan you want. Higher credit scores usually qualify you for a shorter loan term, a lower interest rate, and a larger loan amount. This does not mean that people with lower credit levels have no more options, although.

Lenders look at your credit and how you’ve handled financing in the past as a road map to determine how you can handle a car loan now. If your credit is good with a positive payment history and few (if any) missed or late payments, overdue accounts, repossessions, or bankruptcies, you are more likely to be able to negotiate a good deal.

On the other hand, if your credit is not that hot, you may need to consider other loan options. With a lower credit score – less than around 660 – you can still get a car loan deal through a subprime lender.

Know your lenders

Two types of lenders you can work with for a car loan are traditional lenders and subprime lenders. Traditional lenders, such as banks, credit unions, and some captive lenders, tend to only help borrowers who have good credit scores.

Subprime financing is done through subprime lenders who are registered with special financing dealers, and they work with borrowers in difficult credit situations. They are indirect lenders, which means that the dealership’s special finance manager acts as an intermediary between you and the lender.

Also known as bad credit lenders, subprime lenders are not limited to your credit rating and reports to help you qualify for funding. They know that many people have had trouble with credit, so they look at additional factors like your income, employment, and willingness to put down a down payment.

Find your credit information

Now is the perfect time to take the first step towards buying your next car. Due to the coronavirus pandemic and recent economic instability, major credit bureaus in the United States are offering you the option of viewing your credit reports once a week for free until April 2021. You can do so by visiting

Then you need to get your credit score up. You can do this in a number of ways. Check to see if your bank, credit union, or credit card company offers free access. Otherwise, you can pay a small fee with the credit bureaus or FICO to get it.

Once you know where you stand, you can research the types of rates and terms generally available to people in similar credit situations. It also lets you see what kind of budget you might need to get into a vehicle that’s right for your situation. You can use online calculators, such as our auto loan estimator, to see how much of a car loan you may also be entitled to.

Find the right car dealership

Once you’ve completed the first step of determining your credit situation, you can move on to the second step in the process of buying a car with bad credit – finding the right dealership.

When you have poor credit, you need to make sure you are working with a registered dealer with the right type of lender. That means finding a special financing dealer, and we want to help.

Auto Express Credit has assembled a large network of these dealers across the country who work with the type of lenders you need. To get in touch with one without all the hassle of driving around town to apply for multiple loans, simply fill out our no-obligation form auto loan application form. We will do our best to put you in touch with a dealer in your area.


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