How To Get A Low-Income Auto Loan

When you have bad credit, one thing that lenders would want to see in order to approve your application is stable, verifiable and sufficient income. If you are not earning enough, they might not approve your auto loan application. Your income is still a big part of your creditworthiness. So hereís how you can get approved for an auto loan even if your income is low.

1) Work on your credit.
Check your credit first before applying for a car loan. If you have bad credit, you will need to fix it first. One way is to make your delinquent credit accounts current. You can also pay down some debts especially those with the largest interest payments. Work on your credit beforehand to increase your chances of getting approved for a car loan even if you have low income. Moreover, doing so improves your payment history which may have a positive implication on your capability to repay.

2) Look for a better-paying job.
Find a job that pays better. This is probably the easiest way to get rid of the low-income problem. However, what lenders consider as stable income and employment is at least a year or two of tenure in the same company. In any case, you can find a part-time job or an extra source of income to convince lenders that you can repay and then get approved for a car loan.

3) Donít buy an expensive car.
One possible reason why your loan application may not get approved is your vehicle choice. You have low income and choosing a pricey car to buy is not realistic. Lenders would certainly not be confident to finance an expensive car when your capability to pay off the loan is questionable.

4) Save money for the down payment.
Donít take out an auto loan without enough cash to put down. Saving up for the down payment may take longer because you are earning low. But what is important is you have money to put down when the time comes for you to buy a car. Never resort to a no-money down auto loan and the likes of it.

5) Find lenders that have helped people with low income.
Work with auto lenders that have experiences in financing people with low income. You can also try going to a credit union. Credit unions are member-oriented. They can be more lenient about the terms of the loan agreement.

Aside from lenders, you can also approach car ownership programs for low-income earners. Examples of such programs are Ways to Work, Cars for Families, Charity Motors, and Jumpstart Ideal Auto Program. Their financing terms and training programs are tailored to the needs of low-income earners like you, so applying for a loan and managing debt and budget can be easier with their help.

6) Apply with a cosigner.
A cosigner increases your chances of getting approved for an auto loan. Your cosigner must be someone you trust and should have good credit. He or she will assume your responsibility as a primary borrower in the event you canít make the payments anymore.
 
     

 

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2019-11-13
 

 
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Auto Approval Center is a lead provider to lenders around the US. Average APR rates range from 3.2% to 24% depending on credit. Some dealers/lenders may have implications for non-payment or late payments, please see your specific terms for more information. By applying with Auto Approval Center, you agree to have your credit pulled for lending purposes and this could have an impact to your credit score. Thank You for your business!
 

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