Posted on May 25, 2016
Which lenders approve auto loans for poor credit and low income?
Suspended Profile
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So the time has come for me to replace my vehicle. I have a 2011 Chevy HHR, 80k miles, average used condition.
The question:
Which lenders approve auto loans for poor credit and low income?
The problem:
• My HHR is worth $3-4k, I owe $7k (upside down)
• I have poor credit
• I lost a good paying job, and am now low on income
Why I need to replace my vehicle:
• The HHR is losing value fast. I worry it will be worth scrap metal by the time I pay it off.
• I have huge safety concerns, particularly with the blind spots. Probably why Chevy discontinued it.
• I have to stop 2-3 car spaces behind the white line of a traffic signal, just to see the lights. This apparently enrages drivers behind me.
• Serious lack of room for a family of 3, a dog, and if we want to go camping/hiking/grocery shopping together.
• 150 HP, and slow excelleration. Not a speeder, but man that's slow. Trying to run a yellow gurantees a red.
• I hate it!
I'm targeting a larger, used, SUV. Price range is from $10-$18k, I'll never get approved for something cheaper...
Thoughts on where I could inquire?
The question:
Which lenders approve auto loans for poor credit and low income?
The problem:
• My HHR is worth $3-4k, I owe $7k (upside down)
• I have poor credit
• I lost a good paying job, and am now low on income
Why I need to replace my vehicle:
• The HHR is losing value fast. I worry it will be worth scrap metal by the time I pay it off.
• I have huge safety concerns, particularly with the blind spots. Probably why Chevy discontinued it.
• I have to stop 2-3 car spaces behind the white line of a traffic signal, just to see the lights. This apparently enrages drivers behind me.
• Serious lack of room for a family of 3, a dog, and if we want to go camping/hiking/grocery shopping together.
• 150 HP, and slow excelleration. Not a speeder, but man that's slow. Trying to run a yellow gurantees a red.
• I hate it!
I'm targeting a larger, used, SUV. Price range is from $10-$18k, I'll never get approved for something cheaper...
Thoughts on where I could inquire?
Car Salesman
Loans
Auto Mechanics
Posted 8 y ago
Responses: 6
Dude, you are going to dig yourself a really deep hole trying to finance like that. I suggest you tough it out, pay off the HHR, and then consider a new car. You do not want to dig another hole that way.
SP5 (Join to see)
Pay it off and save a real down payment for your next purchase. Consider using the USAA auto purchasceing service if you are uncomfortable dealing with car sales forces -it happens. The best thing to remember "it's your money the sales person is spending". DO NOT let a sales person guilt you into something you cannot afford. Your family comes first as your mission in life. Keep on paying the current loan and rebuild your credit at the same time.
When you say "poor credit", are you in the 600's or the 300's. And yes, dealerships make more money when you finance, but its not the dealership that makes all that interest, its the bank its financed through. Who valued your HHR? A dealership, or did you look it up on a website, ie. KBB.com or NADAguides.com? A reputable dealer will not find a loan over 18-19%. There are some other companies out there that offer loans in the 20's and 30's, but at my dealership, we do not do business with them. Rule of thumb (ESTIMATE ONLY!) is $20/mo for each $1000 borrowed. So your $4000 upside down, add roughly $80 to your monthly payment just to cover the balance. All that being said, there are too many variables, from too many lending institutions, to give precise #'s for your unique set of circumstances. Talk to a dealership. If you don't like what they offer, don't take it. You didn't lose anything but a couple of hours.
Suspended Profile
Excellent answer. My credit is just under 600. But you are correct, there are a lot of variables. Just received a call from a dealership who left a VM claiming they found a loan for me, So I guess we will see. I will be taking your advice.
SrA Joseph Salnicky
Low credit score u might have to put more down interest to your new load. Seen you still have $7000 due on your vehicle.
Trading is about the only option. With poor credit and being as upside down as you are, you need to set your sights way lower on replacement vehicle.
Suspended Profile
Indeed, my expectations aren't that high. I would prefer to do a trade-in and get a loan for the rest, $4-7k, but an auto loaner wouldn't do that because they wouldn't profit from it. They'll encourage buying more expensive vehicles, to add value to the interest. The problem with that, is finding an agency who will approve me.
PO3 Shayne Seibert
Hate to say it, but you will need to see what they have $3k-5k range and hope they will pay off your car. You will be dealing with the cut throat dealers because you have no real choice.
I'd bite the bullet and keep the car, and hope some family members can float you some coin to pay it down a bunch.
I'd bite the bullet and keep the car, and hope some family members can float you some coin to pay it down a bunch.
MSgt Mark Beavan
But you don't necessarily have to set your sights lower. I've had customers that were turned down for a used car but approved for a new car. It all has to do with the value of the vehicle your looking at. Example - a used car is listed at 7000, the dealership has 6000 in it, and only books out at 7500, your not going to get very many lower score people approved for a loan on it. That same 7000 car, has 4000 in it, and books out at 10000, has a lot more value that banks are looking for. And that is only ONE factor that is looked at.
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