High Risk Auto Loans

High Risk Auto Loans

Do you need a high risk car loan due to bad credit, no credit, or other issues?  We can help.  On a daily basis, we help applicants just like you find loan lenders willing to approve their credit for financing.  We have literally hundreds of lenders in our network, including dealers, banking institutions, credit unions, and other high risk auto loan lenders.  All you have to do is apply through our secure SSL application.  We will immediately go to work placing your application with the company that suits you best, based on variables such as:

  • Your Location
  • Your Credit Profile
  • Your Monthly Income
  • Your Down Payment Amount

Currently our approval rate is about 4 out of every 5 applicants (80%).  We are not one of those fly-by-night brokers that claims 100% guaranteed approval.  We are a transparent, industry-leading, reputable company that works hard to provide our customers with the very best auto financing experience possible.

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The Basics of High Risk Auto Financing

High risk car loans go by a few names:  bad credit, special finance, or subprime auto loans.  In any case, the applicant is deemed “high-risk” because he or she has a tarnished credit history due to bankruptcy, repossession, unpaid bills, excessive credit card debt, or other credit issues.  Anyone with a credit score of 620 or lower is typically categorized as high risk.  This is also the threshold below which a person is said to have bad credit.

If you know any bankers or loan officers, then you know that they are not in the business of taking risks.  To the contrary, most banks will automatically decline any applicants with credit scores below a given threshold.  The same goes for many large dealerships that do not have Special Finance departments.  Unfortunately, such businesses will often encourage you to apply despite their stringent approval guidelines.  That means you could needlessly have your credit report pulled, which of course causes a slight drop in your credit score – not what you want if your credit is already shaky!

The high risk auto loan companies in our network, however, work hard to approve as many candidates as possible.  They are a better alternative to “buy here pay here” car lots, because they actually report your payments to the credit bureaus.  This allows you to re-establish your credit history.

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Minimum Requirements For High Risk Auto Loans

In order to get approved for a high risk auto loan, you need to meet a few requirements.  We have outlined these below:

  • Income: The minimum required income is $1500.  However, it is preferable to make $1800 per month if your score is less than 620.  Note:  this is gross income, before taxes.  Many lenders prefer or even require W2 income, as opposed to 1099 (self-employed) income because it is more stable and verifiable.
  • Employment: Not only must you be employed, but you typically need to have worked for the same employer for 12 months.  Also, you may need to have 2 years of previous employment.
  • Citizenship: Typically, you need to be a US or Canadian citizen to qualify for this type of financing.

Notably, there is no minimum requirement as far as down payment amount for high risk credit auto loans.  Having someone co-sign your loan could not only help you get approved, but lower your interest rate as well.  However, before you ask a parent, sibling, relative, or close friend to act as your co-signer, you should understand that they will be taking on a good bit of risk themselves.  If you are unable to keep making your payments for any reason, they will be legally obligated to take over and pay off your auto loan.

Rebuilding Credit Through a High Risk Car Loan

Did you know that a subprime car loan is a great way to re-establish your credit history? That’s right. However, you have to pay it off as scheduled of course. Doing so shows future creditors and lenders that you are “back in the saddle” when it comes to your credit. It will raise your credit score, and hopefully enable your next loan to a lower risk, lower interest one. Again, an installment loan like this will only improve your credit score if you make all of your payments on time and in full.

High Risk Auto Loan Rates

The rates on these types of loans are substantially higher than average. This should come as no surprise, given that APR rates are inversely proportional to credit score. Typically, you should expect to pay 12-18% APR on this type of loan. Unfortunately, we cannot be more specific than that, since rates are highly dependent on your location, individual credit profile, and actual lender. To receive a customized rate quote, please apply online for financing.