You'll get a better car loan rate with a downpayment.Should You have a Downpayment for Your Next Car Loan?

Trying to get a car loan can be a daunting process for just about anyone, but most people can find something to work in their favor, such as a good credit score or a responsible co-signer. For those who have a rough credit score, your most important ally is a nice down payment.


The biggest problem with this, for most, is that saving the money for a down payment can be difficult - especially if you need a car now. Sometimes life presents circumstances that make waiting 3-6 months to get a new car unrealistic. Therefore, saving for a down payment becomes impossible.


If this is the situation you currently find yourself in, there are ways to get a down payment without taking any money out of your own pocket. The most popular and convenient way to do this is by purchasing a car that comes with a cash back incentive. This incentive can be used as your down payment, thereby allowing you to have a down payment immediately. Alternatively, you could get a traditional bank loan for a small amount, as the interest rate would almost certainly be lower than the rate the finance company will give.


The importance here for those with bad credit is that having this immediate cash will make you much more attractive to lenders and give you some leeway where your credit is concerned. The larger this down payment, the more leeway a lender may be willing to afford you. So, if you have extra cash that you can put on top of this incentive, that will be even better.


Even if your downpayment is small, it will still help you get into the vehicle you need in less time at a better rate.


We're always available to help you get a car that will work for you - regardless of your current or past credit situation. Click for a car loan NOW to fill in our 2 minute Guaranteed Application!

Back to Articles