How does Getting a Car with bad credit work?

Question

I have bad credit, from not being able to pay credit cards in college, but now 5 years later have a very high income, 75K.

Answer 1

then y not just pay cash for a car and save the trouble and the interest charges?

Answer 2

I just bought a car and have fair credit, not horrible. Made some bad mistakes in the past, but have been good over the past two years or so.

I am paying about 13% in interest. Yes, that is correct.

My wife and I make enough so that the payments won't break us, but it does hurt to have to pay so much in interest. I'll be paying about $2,200 per year over the life of the loan in interest. I had no choice as we needed a new car and couldn't wait any longer. To be fair, we also bought a $30,000 plus car which also puts things in perspective.

It sucks when you have bad/fair credit, but if you need the car then you have no other choice unless you have a lot of cash.

If you got something to trade-in, that would help also. We did, and it helped us alot when we finalized all the paperwork.

Good luck!!!

Answer 3

Well it works like this. Cars are durable products. Meaning that if you do not pay you don't get to play. They pick it up ansd a credit colledtion goes after part of your 75K. However some dealers will try to get you to pay a high percentage finance charge. If you make that kind of money why don't you pay cash? The best way is to contact the people at the FEDERAL STUDENT LOAN DEPARTMENT and pay them off. I hear they are even making Doctors pay it back now . lol I You would not believe how many Doctors have outstanding student loans. I am assuming those loans are what is making it possible for you to make 75K Be a good American and pay it off. You will feel better. (hopefully)

Answer 4

Save up 50% (or more - if you have it) in cash as a down payment and finance the other 50% from the bank - the dealer loves seeing wads of cash and a cashier's check from a bank. The bank will give you a better interest rate because you've put down half the value - meaning that you're not upside down on the car (where the car is worth less than the loan) and the bank has equity in the car should something go wrong. Good luck.

Answer 5

Don't buy anything.
Pay off all that you owe.
If you finance a car with bad credit, the amount of interest you pay will be the same as purchasing two cars. If you bought a car for $20,000 for 5 years with bad credit and the interest rate is 18% ....You will be paying $3600 a year in interest alone. That is $18,000.00 in interest in the length of the loan. Yikes!

Answer 6

Well, you'll most likely have to put up a good sized down payment and your percentage rate will be higher than normal.

You also probably won't qualify for the 0% financing or cash rebate programs advertised on TV because if you read the fine print it says, "for WELL qualified buyers".

Your best bet is save up and pay cash and that way, you might actually pay LESS than sticker price.

Good luck.

Answer 7

Well they will charge you a higher interest rate, so the best thing to do is walk in with a boat load of cash to put down on the car.

Answer 8

Consider the Auto Loan Marketplace at http://creditoffernow.com/autoloan. Auto loans for any credit situation. Takes time to get started again but this may be your answer. Best of luck!

Answer 9

Pay your debt, repair your credit, check credit unions for small loans or auto loan.
Other solution is to buy a reliable banger, cash, and then repair your credit. I know people who did that.

Answer 10

like buying furniture from a rent to own place. You will pay more than the car is worth.