Compare rates with lenders that offer car loans for bad credit
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
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Written by Carol Pope | Edited by Amanda Push | Reviewed September 3, 2024
Best auto loans for bad credit in 2024
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
| Lender | User ratings | Best for… | Starting APR | Minimum credit score | Loan terms | Loan amounts | |
|---|---|---|---|---|---|---|---|
| User ratings coming soon | Unique perks | 5.99% | No minimum credit score | 24 to 72 months | $500-$100,000 | See Personalized Results | |
(4,087) User Ratings & Reviews Ratings and reviews are from real consumers who have used the lending partner’s services. | Preapproved car loans | 6.49% | Not specified | 36 to 72 months | Starting at $4,000 | See Personalized Results | |
(1,465) User Ratings & Reviews Ratings and reviews are from real consumers who have used the lending partner’s services. | Online car shopping | 7.90% | No minimum credit score | 36 to 78 months | Starting at $1,000 | See Personalized Results | |
(7) User Ratings & Reviews Ratings and reviews are from real consumers who have used the lending partner’s services. | Buyers with bankruptcies or no credit | Not specified | No minimum credit score | 48 to 72 months | Up to $50,000 | See Personalized Results |
See Personalized Rates
Bad credit car loans at a glance
Best for unique perks: CarMax
5.99%
24 to 72 months
$500-$100,000
No minimum credit score
Pros
- If you find a better rate within three days of getting your loan, you can back out at no extra cost
- 90-day/4,000-mile limited warranty on cars
- Free car delivery, in some cases
Cons
- CarMax Financing is only available at CarMax dealerships
- Expect a rate as high as 28.00% if you have bad credit
- Not available in all states
CarMax offers some great perks. One of them is its Three-Day Payoff Program. If a competitor offers you a cheaper rate within three days of your car purchase, you can back out of your CarMax loan with no extra fees. Plus, you could get your car delivered to your home for free if you live within 60 miles of a CarMax dealership in certain areas.
As CarMax’s in-house financing arm, CarMax Financial loans are only available at CarMax dealerships. And since CarMax only sells used cars, a new car is off the table.
Read our full CarMax Auto Finance review.
How to qualify
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CarMax Financial doesn’t have a minimum credit score requirement. It will review your credit history to check for on-time payments. And while CarMax doesn’t require it, making a down payment on your car can help you get a better rate.
Also, you won’t find CarMax in Alaska, Arkansas, Hawaii, Montana, North Dakota, South Dakota, Vermont, West Virginia and Wyoming.
See Personalized Results
Best for preapproved car loans: Capital One
6.49%
36 to 72 months
Starting at $4,000
Not specified
Pros
- Offers car loan preapproval, which acts the same as cash at the dealer
- If you aren’t ready for preapproval, you can prequalify and check rates without dinging your credit
- Auto Navigator car shopping can help you find your next ride and get prequalified at the same time
- Can manage loan online and via mobile app
Cons
- Doesn’t give loans if you’re buying your car from a person (not a dealer)
- Capital One only works with specific dealerships
What to know
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You can get a preapproved car loan on Capital One’s website. It requires a hard credit hit and works similarly to a check made out to the dealer in the amount you qualify for. This can help you stay within your budget and give you negotiating power, too.
Capital One doesn’t specify its minimum credit score requirements, but internal LendingTree data shows it offers bad credit car loans. However, you can only use Capital One auto loans (preapprovals and otherwise) at select partner dealers.
Read our full Capital One auto loan review.
How to qualify
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Capital One doesn’t specify its borrower requirements, but the following vehicles are ineligible for financing:
- Cars worth less than $4,000
- Oldsmobiles, Daewoos, Saabs, Isuzus
- Cars with branded titles
- Cars that are older than 10 years and have more than 120,000 miles (in most cases)
See Personalized Results
Best for online car shopping: Carvana
7.90%
36 to 78 months
Starting at $1,000
No minimum credit score
Pros
- Can buy or trade in a car completely online
- Cars have a money-back guarantee for seven days
- Does not require a minimum credit score
Cons
- Only offers loans for cars bought through Carvana.com
- Can’t see vehicle in person before buying
- Not available in every state
What to know
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Instead of heading to a dealership, you could buy a car from Carvana. This used car website does everything digitally. You won’t get to see the car in person until you buy it, but you do have seven days to return your purchase if you aren’t happy.
Carvana has faced several lawsuits regarding tag and titling issues, which is something to consider. Also, as of this writing, there are only 40 Carvana locations across the country (which is where you’ll pick up your car).
Read our full Carvana Financing review.
How to qualify
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To qualify for Carvana Financing, you must:
- Be at least 18
- Make at least $5,100 a year
- Have no active bankruptcies
See Personalized Results
Best for buyers with bankruptcies or no credit: Westlake Financial
Not specified
48 to 72 months
Up to $50,000
No minimum credit score
Pros
- Can still get a loan if you’ve declared bankruptcy (even if the bankruptcy is still open)
- Don’t need to meet a specific credit score or income requirement to qualify
- Since there’s no minimum amount it’ll finance, could be a good choice for a cheaper used car
Cons
- You can only apply through a dealer who partners with Westlake
- Bad-credit borrowers can only finance up to $25,000
- Bad credit car loans come with a fee of at least $349
What to know
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Getting a car loan after bankruptcy can be tricky, but Westlake Financial could help. This lender is ok with bankruptcies and may even work with you if you have no credit.
Still, just because you qualify for a Westlake Financial car loan doesn’t mean it’ll be cheap. You could expect to pay high rates — as well as hundreds in fees — if your score is truly poor (580 or less).
Read our full Westlake Financial auto loan review.
How to qualify
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Westlake Financial has very few requirements. It may still help you buy a car if you have:
- Open and past bankruptcies
- A hard-to-prove income
- No or low credit
- Only been at your job or in your residence for a short period of time
Also, note that you can only get a Westlake Financial auto loan if you buy through a dealer in its network.
See Personalized Results
What to know about bad credit car loans
It’s not impossible to buy a car with a bad credit auto loan, but prepare for higher interest rates. There are no federal regulations that cap auto loan rates. Instead, individual states set their own limits.
Even so, some states allow dealers to exceed interest rate caps as long as the dealer lets the state know in advance. In these cases, you could see rates in the triple digits.
Most lenders are legit, but read the fine print before signing anything. Also, use an auto loan calculator to understand the true cost of your loan, including interest.
On this page
- How to get a car loan with bad credit
- How to compare bad credit car loans
- Tips to improve your chances of getting approved for a car loan
- How we chose the best bad credit car loans
- Frequently asked questions
Beware of buy here, pay here car lots
Many bad-credit borrowers turn to buy here, pay here car lots, but try to keep these as a last resort. These types of car lots offer in-house financing. That means the dealership itself provides the loan instead of a bank or lender.
Buy here, pay here lots have loose eligibility requirements. Some won’t check your credit at all. They also tend to charge super-high rates that could lead to a cycle of debt.
Car loan rates by credit score
When it comes to car loan rates, your credit score isn’t the only factor — but it plays a major role. Below you’ll find the average APR for used and new cars broken down by credit category.
| Credit score | Average new car APR | Average used car APR |
|---|---|---|
| Super prime (781-850) | 5.38% | 6.80% |
| Prime (661-780) | 6.89% | 9.04% |
| Nonprime (601-660) | 9.62% | 13.72% |
| Subprime (501-600) | 12.85% | 18.97% |
| Deep subprime (300-500) | 15.62% | 21.57% |
Source: State of the Automotive Finance Market Q1 2024
How to get a bad credit car loan with LendingTree
- Check your credit score. Get your credit score for free with LendingTree Spring. Plus, we’ll alert you when your credit score changes. Seeing that number tick up as you improve your credit might be the psychological boost you need to keep the ball rolling.
- Let LendingTree do the shopping. Take the hassle out of comparing rates and let LendingTree take the wheel. With one quick form, you could have offers from up to five lenders. Checking rates doesn’t hurt your credit score, and best of all, it’s free.
- Compare and save. Once you have your offers, you can customize them to fit your budget. We’ll also show you how your rate compares with our marketplace average. If you like what you see, we’ll help you take the next steps so you can finalize your loan and snag your ride.
How to compare bad credit car loans
What to know about comparing bad credit car loans
→If a loan shows a range of possible APRs, pay attention to maximum, not the minimum. You’ll only qualify for minimum APRs if you have excellent credit.
→You might have a high rate, but if you pay your car loan off fast, you can pay less overall interest.
→Lenders might not be willing to give you a big loan, so you might want to limit your search to used cars.
→Bad credit car loans often come with high documentation (or doc) fees. This can make a car look cheaper than it really is. Ask for the out-the-door price so you know exactly what to expect.
Whether this is your first auto loan or your fifth, decoding loan offers isn’t exactly easy. Here are some definitions to help.
APR: Your APR shows you how much your loan costs, including interest and fees. The higher your APR, the more expensive your loan.
Repayment terms: Your loan term is the length of time you have to pay off your car. Car loan terms generally range between 12 and 84 months. Choosing a longer term can mean a lower monthly payment, but you may pay more interest overall.
Fees: Car loans come with fees. Some are mandatory, like registration fees and sales tax. Other dealer fees, like warranties and protection packages, are extras you can decline.
Lender reputation: Unfortunately, predatory lenders and bad credit go hand in hand. Check the Consumer Financial Protection Bureau (CFPB) complaint database to see how it does business.
Expert insights on bad credit car loans
 Jacob Channel, senior economist | “Even if your credit is less than ideal, sometimes you just can’t put off buying a car. Fortunately, there are auto lenders who work with borrowers with poor credit. While these loans will likely come with steeper rates, they can be helpful if you truly need a new set of wheels. If you do have bad credit, it can pay to shop around and compare offers from different lenders before you buy.” |
Jacob points out that no two loans are alike. Every lender has its own way of calculating rates. Just like insurance, you have to compare rates before you can be confident you’re getting the best deal.
Tips to improve your chances of being approved for a car loan
Get a cosigner. If you’ve got someone with good credit willing to back you up, consider adding a cosigner on your car loan. Know, though, that late loan payments affect both your scores.
Make a big down payment. Zero-down bad credit car loans can be tempting, but steer clear. A big down payment can convince a lender that you’re serious about paying your loan back, making it easier to get approved.
Improve your score. Are you able to buy yourself some time and improve your credit score? It might be worth getting a cheap car with cash instead of taking a loan. It’s not an overnight fix, but waiting to get a car loan until you have at least good credit (670+) could save you thousands in interest.
How we chose the best bad credit car loans
We reviewed 25 auto lenders to determine the overall best four bad credit car loan lenders. To make our list, lenders must offer auto loans to borrowers with credit scores 580 and below. From there, we prioritize the following factors:
- Accessibility: We choose lenders with auto loans that are available to more people and require fewer conditions. This may include lower credit requirements, wider geographic availability, faster funding and easier and more transparent prequalification, preapproval and application processes.
- Rates and terms: We prioritize lenders with competitive APRs, fewer fees and greater loan options for repayment terms and amounts.
- Repayment experience: For starters, we consider each lender’s reputation and business practices. We also favor lenders that have self-service payment options (such as a mobile app), provide reliable customer service and offer unique perks.
According to our systematic rating and review process, the best bad credit car loans come from CarMax, Capital One, Westlake Financial and Carvana. LendingTree reviews and fact-checks our top lender picks on a monthly basis.
Not all lenders we reviewed can be found on LendingTree’s loan marketplace, and your offers may or may not include lenders on this list. Our goal is to give you accurate, helpful information so you can find the best auto loan for your unique financial situation.
Frequently asked questions
It’s possible to get a car loan with a 500 credit score, but the lender might have other requirements, too. You might also need to earn a certain amount of money every year or have been at your job for a specific length of time.
The best way to see if you qualify for an auto loan is to prequalify. It doesn’t require a hard credit hit, so prequalifying won’t negatively impact your credit.
There is no standard lowest credit score for a bad credit auto loan. Some lenders don’t require a specific credit score at all. Keep in mind that the easier it is to get a loan, the more expensive that loan will probably be. Even if you have bad credit, shop around and compare offers to find the loan that’s best for you.
Generally, buy here, pay here car lots are the easiest places to get financing from. That said, you might have other less-expensive options. Buy here, pay here dealerships are often predatory.
Instead, prequalify online with a few lenders to make sure that you truly have no other option. That, or skip financing altogether and pay cash for a cheap used car.
