How to get a loan with bad credit

Filed in archive Managing Your Debt on June 9, 2010

© richardmasoner

A bad credit rating affects every part of your life. It makes it almost impossible to get a credit card, and almost impossible to secure a loan of any kind. If you do manage to get a credit card or a loan, you will be paying extremely high interest rates. When it comes to needing a car, some jobs require that you just have to have one. Your job may start too early for trains or buses, or finish too late to catch public transport home. If no one is able to pick you up and drop you off for work, your chances of keeping your job are slim.

If you do have a regular income and are maintaining all your debt payments, you may be able to get a car loan. That is because car dealerships can often get you an auto manufacturers' loan and you do not need to go through a bank or other lending agency. It will probably be at a high interest rate, but if having a car means you can keep your job, then sometimes you do not have an option.

Used car dealers can usually not offer you manufacturers financing, but it is worth checking. Don't be caught by car dealers who say they can give anyone with bad credit financing. They can, but read the small print and make sure you understand exactly how much the cost of the loan will be over the length of the payments. Sometimes it just is not practical to get a loan from them.

The key to getting credit when you have a bad credit rating is to show, using documentation, that you have a regular income, are already paying all your debt payments on time, and, you can afford to pay the regular car payments as well.