Having a less-than-perfect credit score can feel like a roadblock when you need a car. Many people worry that bad credit means they are shut out of the auto loan market, but that’s not the case. Even with a credit history that’s seen better days (scores dipping below 670), you still have viable options for securing car financing. The key is knowing Where To Get Car Financing With Bad Credit and how to navigate the process to find the most favorable terms available to you.
Comparing lenders and understanding your options is crucial when you have bad credit. Interest rates will likely be higher, but by doing your homework, you can still find a manageable loan and get behind the wheel of a vehicle you need. This guide will walk you through some of the best places to explore for car financing when your credit score isn’t ideal.
To help you make informed decisions, we’ve analyzed numerous car loan lenders, focusing on those who cater to individuals with bad or fair credit. Our evaluation considered factors like loan types, affordability, credit requirements (or lack thereof), and the overall loan shopping experience. Here are our top recommendations for car lenders that are known to work with customers who have less-than-perfect credit.
Top Lenders for Car Financing with Bad Credit
It’s essential to shop around when seeking where to get car financing with bad credit. Here are some lenders that stand out for their willingness to work with borrowers who have lower credit scores:
Carvana: Best for Online Car Buying with Bad Credit
Alt Text: Carvana website displayed on a laptop screen showing used car listings, highlighting online car buying for bad credit borrowers.
Key Loan Terms:
- Starting APR: 7.90% (Terms apply)
- Loan Purpose: Used Vehicles
- Loan Amounts: Not specified
- Loan Terms: 36 to 72 months
- Credit Needed: Not specified
- Early Payoff Penalty: None
- Late Fee: $5 after a 16-day grace period
Pros:
- Welcomes borrowers with bad credit histories.
- No penalties for paying off your loan early.
- Prequalification available without impacting your credit score.
- Fully online application process for convenience.
- Option to include a co-signer for better approval odds.
Cons:
- Financing is limited to vehicles purchased directly from Carvana.
- Service availability is not nationwide.
Who is Carvana for? Carvana is an excellent choice if you prefer the convenience of online car shopping and are looking for where to get car financing with bad credit entirely through a digital platform. They specialize in used vehicles and offer a streamlined, online-only car buying experience.
Standout Features: Carvana offers a quick prequalification process that takes just minutes and doesn’t affect your credit score. They are known for their customer-friendly policies, including a 7-Day Money Back Guarantee and direct-to-your-door vehicle delivery.
Capital One Auto Finance: Best Big Bank Option for Bad Credit
Alt Text: Capital One Auto Navigator tool displayed on a tablet, showcasing vehicle search and estimated loan terms, ideal for bad credit borrowers seeking financing from a large bank.
Key Loan Terms:
- Starting APR: Varies based on credit profile (Terms apply)
- Loan Purpose: New Vehicles, Used Vehicles, Refinancing
- Loan Amounts: Starting at $4,000
- Loan Terms: 24 to 84 months
- Credit Needed: Not specified
- Early Payoff Penalty: None
- Late Fee: Varies by lender
Pros:
- Open to borrowers with less-than-perfect credit.
- No penalty for early loan repayment.
- Prequalification process available online.
- Offers helpful online tools for vehicle searching and estimating loan terms.
Cons:
- Financing is only available for purchases from participating dealerships.
- Final loan terms are only provided at the dealership.
Who is Capital One Auto Finance for? If you prefer working with a well-established national bank and are wondering where to get car financing with bad credit from a reputable institution, Capital One Auto Finance is a strong contender. They offer competitive rates, especially for a large bank, and are known to be more accommodating to borrowers with credit challenges.
Standout Features: Capital One’s Auto Navigator tool is a significant benefit, allowing you to prequalify for loan offers without impacting your credit score and to explore different loan terms to find what fits your budget.
CarMax Auto Finance: Best for Used Car Selection with Bad Credit
Alt Text: CarMax dealership lot filled with used cars, illustrating a wide selection for car buyers with bad credit seeking financing.
Key Loan Terms:
- Starting APR: Not disclosed (Terms apply)
- Loan Purpose: Used Vehicles
- Loan Amounts: Starting at $500
- Loan Terms: 36 to 72 months
- Credit Needed: Not specified
- Early Payoff Penalty: None
- Late Fee: Varies by state and contract
Pros:
- Works with borrowers who have bad credit.
- No early payoff fees.
- Prequalification available online.
- Offers a fully online application process in many cases.
- Low minimum loan amount, starting at just $500.
- Allows co-borrowers to improve approval chances.
Cons:
- Financing is restricted to cars purchased from CarMax dealerships.
- Not available in every state.
- Prices at CarMax are generally non-negotiable.
Who is CarMax Auto Finance for? If you are in the market for a used car and value a vast inventory to choose from, CarMax Auto Finance is worth considering as where to get car financing with bad credit. As the largest used car retailer in the U.S., they offer a wide selection and financing options for various credit profiles.
Standout Features: CarMax provides a tool to adjust your desired monthly payment and APR to see personalized prequalified offers quickly. Their Three-Day Payoff program is also a significant advantage, allowing you to refinance at no cost if you find a better APR within three business days of your purchase.
Autopay Car Loan: Best for Refinancing with Bad Credit
Alt Text: Autopay website displayed on a desktop, showing loan options and application process, highlighting refinancing for car owners with bad credit.
Key Loan Terms:
- Starting APR: 4.67% (Terms apply)
- Loan Purpose: Used and New Vehicles, Refinancing, Lease Buyout
- Loan Amounts: $2,500 to $100,000
- Loan Terms: 24 to 96 months
- Credit Needed: Not specified
- Early Payoff Penalty: None
- Late Fee: Varies by lender
Pros:
- Accommodates borrowers with bad credit seeking refinancing.
- No early payoff penalties.
- Prequalification process available.
- Offers a broad range of loan amounts.
- Allows co-applicants to strengthen the application.
Cons:
- Loan approval can take up to 48 hours.
- Loan funding might take up to two weeks.
Who is Autopay for? Autopay is an excellent resource if you are looking for where to get car financing with bad credit for refinancing your current vehicle. They specialize in connecting car owners with imperfect credit to refinancing options that can lower monthly payments or offer better terms.
Standout Features: While Autopay also provides financing for new and used car purchases, their strength lies in refinancing. They offer various refinancing options, including traditional refinancing, cash-back refinancing, and lease buyout financing, providing flexibility for borrowers.
Westlake Financial Auto Loan: Best for Low or No Down Payment with Bad Credit
Alt Text: Westlake Financial website displayed on a smartphone, showing pre-qualification form and loan options for various credit scores, emphasizing low or no down payment financing for bad credit.
Key Loan Terms:
- Starting APR: 2.99% to 29.99% (Terms apply)
- Loan Purpose: New and Used Cars, RVs, Commercial Vehicles, Classic Cars, Highline and Exotic Cars
- Loan Amounts: Up to $30,000
- Loan Terms: 48 to 72 months
- Credit Needed: Offers programs for all credit score ranges
- Early Payoff Penalty: Not disclosed
- Late Fee: Not disclosed
Pros:
- Open to borrowers across all credit score ranges, including bad credit.
- Financing available for a wide range of vehicle types.
- Online pre-qualification available for convenience.
- Accepts multiple payment methods.
Cons:
- Some fees are not transparently disclosed on their website.
Who is Westlake Financial for? Westlake Financial is a suitable option if you’re exploring where to get car financing with bad credit and are concerned about a down payment. They offer various loan programs tailored to different credit score ranges, including a program specifically for credit scores in the 0-599 range, making them accessible to those with very poor credit.
Standout Features: Westlake Financial’s website allows you to browse vehicle inventory at dealerships within their network, streamlining the process of finding both a car and financing in one place.
iLending: Best for Long Repayment Terms with Bad Credit
Alt Text: iLending website interface showing loan application form, highlighting long repayment terms for borrowers with bad credit.
Key Loan Terms:
- Starting APR: 5.49% – 19.24% (Terms apply)
- Loan Purpose: Refinance
- Loan Amounts: $5,000 to $150,000
- Loan Terms: 12 to 96 months
- Credit Needed: 560+
- Early Payoff Penalty: Not disclosed
- Late Fee: Not disclosed
Pros:
- Low minimum credit score requirement (560+).
- Accepts borrowers with limited credit history (six months minimum).
- Offers longer repayment terms up to 96 months.
- Provides skip payment options.
- No application fee.
Cons:
- Some fees are not disclosed on their website.
Who is iLending for? If you are specifically seeking where to get car financing with bad credit that offers longer repayment periods, iLending is a strong choice. They are particularly beneficial for those looking to refinance an existing car loan and need extended terms to manage payments.
Standout Features: iLending stands out with its lenient credit requirements, making it accessible to borrowers with thin credit histories. They require only a six-month credit history and at least one trade line, opening doors for those who are relatively new to credit. Their 96-month maximum term is also longer than many competitors, offering more flexibility in managing monthly payments.
Deeper Dive into Top Car Loan Options for Bad Credit
To help you further in your search for where to get car financing with bad credit, let’s explore more details about each of these top lenders:
Carvana
Carvana, known for its unique car vending machines, provides financing specifically for vehicles in its inventory. They are known to work with a wide range of credit profiles and allow co-signers, making them accessible for those wondering where to get car financing with bad credit. You can prequalify without a hard credit check to see estimated terms.
Once prequalified, personalized loan terms are displayed with each vehicle on their website. After selecting a car and arranging pickup or delivery, a hard credit check is performed, and final loan terms are provided.
Auto Loan Purpose: Used vehicles only
Co-borrowers Allowed? Yes
Credit Score Requirements: Carvana doesn’t specify a minimum, but some lenders they partner with may have requirements.
Capital One Auto Finance
Capital One Auto Finance offers its Auto Navigator tool to help you shop for new or used cars at participating dealerships. With a network of over 12,000 dealers, Capital One provides a broad selection. For those wondering where to get car financing with bad credit from a major bank, Capital One is a prominent option.
Prequalification is available without a hard credit inquiry, and co-applicants are allowed to improve approval odds and potentially secure better terms. Once prequalified, you can see estimated rates and monthly payments for available vehicles.
Auto Loan Purpose: New vehicles, used vehicles, refinancing
Co-borrowers Allowed? Yes
Credit Score Requirements: Not advertised
CarMax Auto Finance
As the largest used car retailer in the U.S., CarMax Auto Finance also offers financing for the vehicles they sell. With a wide network of financing sources, CarMax caters to customers with various credit profiles, making it a viable answer to where to get car financing with bad credit. There is no minimum credit score requirement explicitly stated.
Their prequalification tool allows you to see personalized terms like APR and monthly payments without impacting your credit. The Three-Day Payoff program offers added security if you find a better loan within three days of finalizing your CarMax loan.
Auto Loan Purpose: Used vehicles only
Co-borrowers Allowed? Yes
Credit Score Requirements: Not advertised, but they state their sources accommodate most credit profiles.
Autopay
Autopay functions as an online platform that partners with various financial institutions offering auto loans. This partnership model enables them to work with customers across different credit situations, addressing the question of where to get car financing with bad credit through a marketplace approach. Beyond new and used car loans, Autopay provides refinancing options, including traditional, cash-back, and lease buyout refinancing.
Prequalification requires only a soft credit inquiry, and co-applicants are permitted. After prequalification, you can compare offers from multiple lenders to select the best fit. Final approval involves a hard credit check and document review by the chosen lender, which can take up to two business days.
Auto Loan Purpose: Used and new vehicles, auto loan refinancing, lease buyout
Co-borrowers Allowed? Yes
Credit Score Requirements: Not advertised, but they state they work with borrowers of all credit profiles.
Westlake Financial
Westlake Financial is a financial services company with a network spanning over 50,000 new and used car dealerships. Their website allows potential borrowers to search for vehicles and prequalify for a loan, making them a convenient option for where to get car financing with bad credit and car shopping simultaneously. Westlake Financial also offers free credit score checks via their credit monitoring tools.
Auto Loan Purpose: New and used cars, RVs, exotic cars, commercial vehicles, and classic cars
Co-borrowers Allowed? Not disclosed
Credit Score Requirements: Considers all credit scores
iLending
iLending (formerly Fleet Financial), established in 2006, operates with physical locations in Colorado, Texas, and South Carolina. While not a direct lender, iLending matches you with loan offers based on your needs. For those wondering where to get car financing with bad credit with flexible terms, iLending is worth exploring.
A minimum monthly income of $1,500 is required to be matched with a lender, though specific lenders may have higher income requirements. The application process is designed to be quick, and you can then review potential loan options and connect with a Loan Consultant.
Auto Loan Purpose: Refinance
Co-borrowers Allowed? Not disclosed
Minimum Credit Score: 560
Understanding Bad Credit Auto Loans
A bad credit auto loan is specifically designed for individuals with lower credit scores. While there’s no universally defined “bad credit” score, generally, scores below 580 may make it challenging to secure financing from traditional banks or credit unions. If you’re concerned about where to get car financing with bad credit, these specialized loans are your target.
Can You Get a Car Loan with a 500 Credit Score?
Yes, it is possible to get a car loan with a 500 credit score, even though it is considered poor. The best approach is to seek out lenders who are known for working with individuals with less-than-ideal credit histories. Lenders view a 500 credit score as a higher risk, so expect to encounter higher interest rates compared to those with better credit. If feasible, consider working on improving your credit score before applying to potentially secure more favorable terms.
Credit Scores Used for Auto Loans
When assessing auto loan applications, lenders typically use various scoring models. Common models include VantageScore 3.0 and 4.0, FICO® Auto Score, and FICO® Scores 8 and 9.
Interest Rates for Bad Credit Auto Loans
Interest rates on auto loans for bad credit are generally higher to compensate lenders for the increased risk. According to Experian’s Q4 2023 State of the Automotive Finance Market report, the average new car loan interest rate for deep subprime borrowers (300-500 credit scores) was 14.78%, and for subprime borrowers (501-600 credit scores), it was 12.28%. Used car loan rates are even higher, reaching an average of 21.55% for deep subprime borrowers.
Related: 4 Tips to Boost Your Credit Score Fast
Future Trends in Car Loan Rates
Predicting car loan rate fluctuations is challenging, as they are influenced by factors like the federal funds rate set by the Federal Reserve. As of the Federal Reserve’s meeting on January 29, 2025, the federal funds rate remained unchanged at 4.25%–4.50%. Given this stability, significant decreases in car loan rates are not expected in the immediate future.
Strategies to Increase Your Loan Approval Chances
Improving your chances of getting approved for a car loan, especially when focusing on where to get car financing with bad credit, involves several strategies:
- Boost Your Credit Score: A higher credit score not only increases approval odds but also leads to better loan terms. Review your credit report for errors and prioritize making timely credit card payments to improve your credit score.
- Consider a Co-signer: Having a co-signer with good credit can significantly improve your approval prospects. However, ensure you discuss this arrangement thoroughly with the co-signer beforehand.
- Increase Your Down Payment: A larger down payment reduces the loan amount, the repayment period, and monthly payments, enhancing your approval likelihood.
Utilizing an Auto Loan Calculator
Before committing to a car loan, use an auto loan calculator to estimate your monthly payments. CNBC Make It provides a helpful loan calculator to project monthly payments, total repayment time, and overall interest costs.
Frequently Asked Questions (FAQs)
How can I buy a car with bad credit and no co-signer?
Securing a car loan with bad credit and without a co-signer is more challenging but achievable. Some lenders specialize in working with customers across the credit spectrum. However, expect potentially higher interest rates, making the car purchase more expensive overall. Thoroughly compare loan offers from multiple lenders to find the most budget-friendly option.
What is the minimum credit score for financing a car?
There is no fixed minimum credit score for car financing. Credit score requirements vary by lender, as each has its own evaluation criteria. Lenders also consider factors beyond credit score, such as income and existing debts. Demonstrating a strong likelihood of loan repayment improves your approval chances.
Bank vs. Dealership Financing: Which is better?
Financing through a bank or credit union can often result in lower interest rates, particularly if you have an existing positive relationship with the financial institution. However, qualifying for bank financing with bad credit can be tougher. Dealership financing offers convenience and can sometimes provide same-day approval and vehicle purchase.
Best time of year to buy a car?
October through December typically offer the best car buying opportunities, with potential for discounts, especially during year-end sales events in December.
Is a car loan possible with a 500 credit score?
Yes, obtaining a car loan with a 500 credit score is possible, although it may be more difficult to find a lender, and loan terms are likely to be less favorable.
Can I get a car loan with a 600 credit score?
Yes, getting a car loan with a 600 credit score is attainable, but you may face stricter loan terms compared to those with higher scores.
Why Trust CNBC Select?
CNBC Select is dedicated to providing readers with high-quality service journalism and comprehensive consumer advice to facilitate informed financial decisions. Our car loan recommendations are based on rigorous research by expert writers and editors with extensive knowledge of loan products. We maintain strict editorial independence, ensuring our content is free from commercial influence and adheres to high journalistic standards and ethics. For more details on our selection process, see our methodology.
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Our Methodology
CNBC Select’s rankings of the best car loans for bad credit are based on an analysis of over a dozen car loan providers, including banks, dealerships, and online marketplaces. Key factors considered in our evaluation include:
- Flexible Loan Amounts and Terms: Lenders offering customizable financing options to suit various budgets and repayment needs.
- Prequalification Availability: Lenders providing prequalification processes without hard credit inquiries.
- Online User Experience: Ease of completing the financing process online.
- Co-signer/Co-borrower Options: Availability of co-signers or co-borrowers to improve approval chances.
- No Early Payoff Penalties: Lenders not charging fees for early loan repayment.
- Streamlined Application Process: Efficiency of application processes, including approval speed.
- Customer Support: Accessibility and quality of customer service.
- Loan Size Range: Variety in loan amounts offered.
Advertised rates and fees are subject to change with fluctuations in the Fed rate. However, a fixed-rate APR guarantees consistent interest rates and monthly payments throughout the loan term. APR, monthly payment, and loan amount are determined by credit history and creditworthiness. Loan applications typically require a hard credit inquiry, proof of income, identity verification, and proof of address.
Explore more from CNBC Select on credit cards, banking, and money, and connect with us on TikTok, Facebook, Instagram, and Twitter for the latest updates.
Further Reading
The best car insurance companies based on cost, coverage and service
Should you take out a personal loan or an auto loan to pay off your car?
The best personal loans if you have bad credit but still need access to cash
The best car loans for flexible terms, low rates and simple application process
Editorial Note: The editorial content of this article reflects the views of CNBC Select editorial staff alone and has not been reviewed, endorsed, or approved by any external parties.
