What Do You Need To Qualify For Bad Credit Financing?

Posted on: 22 March 2022

When you check your credit score, how do you feel? If your score is not as good as you wish, you might feel discouraged when you check it. You might wonder how you'll ever get a loan to buy the car that you need to get to work.

You're not the only person in this position. Around 16% of adults have bad credit, and another 18% have a score that ranks as "fair." People in these categories can get auto financing by visiting a bad credit financing dealership.

Here's what you'll need to qualify for this type of financing:

A driver's license

Do you have a driver's license? If not, you don't need a car because you can't drive without one. However, if you're looking for a vehicle to buy, you probably have a license. The dealership will ask for this when applying for a bad credit loan. Your license proves you can drive, but it also proves your identity and address.

Money down

Do you have some cash you can put down on a car purchase? Most bad credit lenders ask for some money down. You might need $500 or more, but it depends on the lender's eligibility rules. You can call around to ask dealers how much they need for bad credit loans. You can visit a dealer once you have enough money to give them.

Your pay stubs

Bad credit lenders base loan approvals and amounts on a person's income. If you don't work, you won't have pay stubs, which means you won't get the loan. However, you'll have pay stubs to show if you have a job. You can bring the last few stubs you have on hand, and you should aim to bring current ones.

A bank account

You can expect the bad credit lender to ask you for your bank account information. Why would they need this information, you might ask? Bad credit loans present high levels of risk to lenders. If your lender gives you a loan, it may depend on agreeing to electronic payments. You set up the payments when you take the loan, thus reducing the lender's risk.

Do you have these things?

As you review this list of things you'll need for bad credit financing, you'll know if this is the right loan type for your situation. If you have these things, you should have no trouble qualifying for a bad credit auto loan.