Car Financing for person with under 600 FICO?

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Does anyone any good suggestions / experience with buying / leasing ne wo used car when they have low credit? Friend said CarMax is possibility?

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Why is your score below 600? Anything that can be done to improve it?

Yes, save up $1000-$2000... watch the side of the road, craigslist, ask everyone you know if they might have a car in that price range and pay cash for it...

right. the fact of the matter is that if you don't have credit, then you just don't get to borrow money to pay for things. If someone has a sub-600 score, they need to pay cash.

Yes, CarMax is your answer. My friend recently purchased a vehicle at CarMax with a 555 FICO Score. He got 19%APR. Good Luck!

I think people in your position often look for something colloquially known as a "buy here, pay here" arrangement, but it's a bad idea. The 19% APR mentioned above is pretty generous. I've heard of people getting upwards of 30%.

With that kind of credit score, leasing is out of the question. Just buy something cheap using cash.

First, let me ask why is your score so low? Do you have an outstanding debt? If so, you'll save a lot of money dealing with that first.

Otherwise, I'd actually guess that buying new and using the manufacturer's financing MAY be your best bet. You'll probably pay 10-12%, and may have to put 20% down, but it's going to be far better than the alternatives. Buy here pay here is going to be over 20%, and used will probably crack 15%. See if you qualify for special financing with the dealership; they often offer discounts to certain employers, college students or recent grads, and loyalty customers.

If you want to PM me the actual score, I may be able to figure out what credit tiers you work into, and who may finance you.

DO NOT deal with Carmax. You will get raped at Carmax, both on financing and price. Carmax is only (marginally) good for people who are absolutely completely haggle averse. If you're willing to walk on a lot and ask even once for a lower price, you'll probably do better than Carmax.

Credit Unions are usually a bit more friendly towards members. If you must, a sub-15% loan may be possible there.

cKGunslinger said:   Credit Unions are usually a bit more friendly towards members. If you must, a sub-15% loan may be possible there.

This isn't always the case, some credit unions are FAR more conservative than banks. Pentagon Federal, for example, can be VERY hard to get money from if your credit is poor. Carmax just finances cars pretty much like anyone else does, via a plethora of banks. Last friend I know who bought a vehicle there was financed by BofA at a slightly high rate due to his residency status. (TN professional visa)

My parents had a local credit union loan them money for a car - and it was a real lemon and had been wrecked before but not salvaged. Then they loaned my parents MORE money to have it fixed, then tried to offer them a "deal" to get out of it with another vehicle but wanted them to USE THE SAME DEALER. I had them leave that CU and helped pay it off quickly. It was at 18% or so too. When we replaced that car the dealer was amazed that any bank would touch a loan on a Saturn of that age based on the original note. I arranged the new car, at a crappy interest rate since my parents had bad credit, but at least the vehicle it was based on was a decent one and even had a bit of factory warranty remaining.

Next vehicle they needed years later I just bought for cash when I ran across a really good deal -and times were good.

True, CU's can definitely be stricter than banks, but I've heard that some CU's will usually look harder at monthly income than credit score. That can work to your advantage in OP's situation, if he makes enough money.

RedWolfe01 said:   cKGunslinger said:   Credit Unions are usually a bit more friendly towards members. If you must, a sub-15% loan may be possible there.

This isn't always the case, some credit unions are FAR more conservative than banks. Pentagon Federal, for example, can be VERY hard to get money from if your credit is poor. Carmax just finances cars pretty much like anyone else does, via a plethora of banks. Last friend I know who bought a vehicle there was financed by BofA at a slightly high rate due to his residency status. (TN professional visa)

My parents had a local credit union loan them money for a car - and it was a real lemon and had been wrecked before but not salvaged. Then they loaned my parents MORE money to have it fixed, then tried to offer them a "deal" to get out of it with another vehicle but wanted them to USE THE SAME DEALER. I had them leave that CU and helped pay it off quickly. It was at 18% or so too. When we replaced that car the dealer was amazed that any bank would touch a loan on a Saturn of that age based on the original note. I arranged the new car, at a crappy interest rate since my parents had bad credit, but at least the vehicle it was based on was a decent one and even had a bit of factory warranty remaining.

Next vehicle they needed years later I just bought for cash when I ran across a really good deal -and times were good.



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