Many people feel that buying a car with no down payment and a bad credit rating is impossible but this is not true. In this competitive world there are many finance companies and car dealers who specialize in dealing with no money down auto loans for people with bad credit.
The first thing you need to do is turn your bad credit to good credit. If you have defaulted on your previous payments you need to clear your act and get a good credit score. This is very important because although the auto finance company may grant your loan they will offer you a short-term loan which means higher monthly payments. If however you do not have a credit score, you need to build one and this may take 6-12 months. Open a credit account with your bank and use the credit card to make timely payments. However, make sure that your bank registers the same with the necessary authorities.
To increase your chances of being approved for no credit no down payment auto loans you need to look for a reliable car. Buying a brand new car is not within your limits and so you should do the following;
1. Look for a private seller. The price will be less compared to that of a dealer and so you will have to borrow less money. You also save money on documentation.
2. You should try to negotiate a better rate or price with the private seller. This is not possible with dealers and so you have to pay the price they ask. So always keep a lookout for such sellers in newspapers, classifieds and notice boards in malls.
3. Many buyers are not aware of this but if you get our car financed thru a dealer you may end up paying more interest on your month payment. You are better off buying the car from the dealer but getting the loan for the car from a finance company.
4. If possible opt for a trade in so that you can cut your loan figure and in case you do not have an old car try to find rebates.
It is always advisable to search for finance companies who give auto loan no down payment services before shopping for a car. This way you are aware of the amount you have at your disposal to pay for the installments of your vehicle. This way when you are at the car dealership you can negotiate the price without having to worry about approval. Always get quotations from 3-4 companies before you get into a contract with any particular one.
Many buyers are not aware of this but the best place to look for finance is online. You will easily find a lender who specialize in bad credit auto loan no money down. The advantage of using an online finance as opposed to a car dealer is that you get to choose the place from where you want to buy your car.