Home Credit score Getting a car under $ 10,000 with bad credit

Getting a car under $ 10,000 with bad credit

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When you have bad credit, getting an affordable vehicle is often essential to getting a car. These days, the availability of these vehicles is declining – cars under $ 10,000 have been the hardest to find since July.

The supply of used vehicles is up 7% since 2020, but still down 13% from 2019, which means current numbers have still not returned to pre-pandemic levels. So what does this mean for you as a bad credit borrower?

This means that finding a car under $ 10,000 can take a while, and you may have to sacrifice other deals to find a cheap car.

Bad credit and affordable cars

As a borrower with a credit score of around 670 or less, you will likely need special financing. Borrowers who need special financing usually have to meet several conditions for a car loan. You may not qualify for the same loan terms that borrowers with better credit can get.

This means that even if you find an affordable car, your costs may be higher due to your credit situation. Credit affects many aspects of auto loans, including the length of your loan, how much you can finance, and your interest rate.

If you are looking for special financing, be aware that the minimum financing amount is generally around $ 5,000, including taxes and fees. With insufficient supply on many dealership lots, the average price of a used car at franchised and independent dealers was $ 25,829 in August, according to a recent report. Beetle Automotive to study.

That said, your best bet for a car under $ 10,000 might be to research a vehicle with a dealership Buy Here, Pay Here (BHPH).

Working with a BHPH dealer

When working with a BHPH fleet, you have the opportunity to find used vehicles that may be more affordable than cars from other larger dealers. BHPH dealers are what are called internal financiers and they provide finance to dealers. This means that there is no waiting for a credit check from a third party lender.

Many BHPH dealers don’t check your credit, which can make it easier to approve a loan when you’re having trouble. The tradeoff is that BHPH lots only sell used cars and often offer higher than average interest rates.

Other ways to buy cheaper used cars these days may seem like a good way to go, like Facebook Marketplace or Craig’s List, but these buying options, while sometimes ridiculously inexpensive, can have their own. problems.

Advice on cheap used cars

If you insist that you can’t afford a vehicle over $ 10,000, there are a few things you should keep in mind when looking for a car:

In for money. There is a difference between a cheap used car and an affordable vehicle. Sometimes when you shop cheaply you get just that – a car that either doesn’t keep its value or falls apart quickly. If you’re on a budget for your next vehicle, focus on finding a reliable car that retains its value, like a Toyota or Subaru.

Always get a pre-sale inspection. A pre-purchase inspection should be a must in any used car buying situation. Taking the vehicle to a certified mechanic can help you spot problems that you might not be able to find on your own. If a dealership doesn’t allow a pre-purchase inspection, consider opting out of the deal, especially if the car isn’t selling for very dear.

Know what you can bargain for. Not all parts of an auto finance deal can be negotiated, but there are a few that can. If you want to come away with the best deal on your next vehicle, make sure you know when to hang on to the numbers. Things like taxes, title, and license fees usually can’t be negotiated, but the interest rate, loan term, final sale price, and dealership documentation fees often can.

Weigh your chances of credit repair. Credit repair is a great benefit of buying a car with a bad credit auto loan. But if you are working with a BHPH dealership to find a cheap car, you might not have this opportunity. Some BHPH dealers do not check your credit and are less likely to report your payments on time to the credit bureaus.

Don’t forget the additional costs. Keeping a vehicle on the road can be expensive. The additional costs like insurance, fuel, and regular maintenance can really add up. The older and cheaper the car, the more likely it is to be fuel inefficient and require more expensive repairs and additional maintenance.

Electric shop. To have a good chance of getting a cheaper vehicle, try shopping for electric. Electric cars don’t have a high resale value, so if all you need is something to get around town, it might be worth a visit. And, if your credit isn’t that bad, you may even have the option of scoring a new EV at an affordable price.

Ready to find an affordable vehicle?

If you aren’t sure where to start on your car buying journey, or if you’re struggling to find a dealership that has what you’re looking for and can help you with your bad credit, we want to help. TO Auto Express Credit, we’ve assembled a nationwide network of specialty finance brokers who have the lending resources you need. Take the stress out of your search by filling out our free auto loan application form.

If you are still looking for the vehicle you need and find the best possible deals on a vehicle under $ 10,000, you can check out our sister site CarsDirect to find the affordable used car you need.


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