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How to Buy a Car with Bad Credit

If bad credit has left you high and dry, but you need a new car, get back on the road despite your lackluster credit score.


  • Step 1: Check your credit report Go online and check your credit report -- you're entitled to one free report each year. Make sure everything is accurate.
  • TIP: If you have a bad credit score, don't expect to haggle for the best interest rate.
  • Step 2: Refinance later Refinance that high interest loan down the road when your credit improves or when rates drop; just be consistent and on top of your payments.
  • Step 3: Shop around Shop around for the best deal either through a bank or through an auto dealership. A bad credit score doesn't mean you can't get a good deal.
  • TIP: Work around your paycheck schedule to be sure your car payment is the first to be tackled each month so you don't get behind.
  • Step 4: Shop smart Shop for a car when sales are slow, such as in bad weather, around holidays, before closing time, or at the end of the month.
  • Step 5: Look at used cars Go to dealers who do their own financing. This may mean downsizing your expectations, but it's better than no car.
  • FACT: At an average price of $28,000, a new car is the 2nd-biggest purchase the average consumer ever makes, after a house.

You Will Need

  • Credit report
  • Banks and dealerships
  • Timing
  • Refinancing options

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