If you have no money to use as down payment for a car loan, you can still get a car.
However, there are some advantages of purchasing a car and making a down payment at the time of purchase.
When you buy a car and make a down payment, it usually leads to low-interest rates which directly gives you low monthly payments.
This is however not possible for everyone because you may not have much money to make those down payments.
How is this possible and what do you need to do to if you decide to go for this option? Here are 4 points you can use starting today.
1.
If you do not have a credit account such as a credit card, establish one to get some sort of credit history before applying for an auto loan.
There are two types of credit cards you can apply for.
These are secured and unsecured credit cards.
It is very difficult to get approved for an unsecured credit card without having any sort of credit history.
So we would advice you consider getting a secured credit card instead.
Over a period of 6-12 months you'll begin to build your credit score.
It is important to confirm with your bank that issues you with the credit card that your credit information will be reported to the credit reference agencies.
The thing is that some banks do not report this information to the reference bureaus if they give you a secured credit card.
2.
Lenders who give no-money down car loans require you to have a good credit score.
It's as such important to check your credit report before completing your auto loan application.
To improve your credit, minimize credit enquiries, pay more than the minimum balance payments and make payments in time.
So as you can see you have plan this ahead of time, ideally 12 months ahead if you want to buy your this way.
3.
If your situation is so bad that getting any of the above two to work out, or you do not have the time to build or repair your credit history, then try to get a relative or a very close friend to co-sign the loan with you.
The decision of the loan lenders will be dependent very much on the credit rating of the co-signer.
If they happen to have an excellent credit score, the lender may simply give you the loan without any problems at all, and without asking you for any money down at all.
4.
This is the last option we know of if you want to by a car and you do not want to put any money down: car assumptions.
This does not happen very often.
However, if you know someone who is trying to get rid of their car, you can assume their car loan.
First, discuss it with them on a personal level.
Then you can contact the lender and enquire if they allow car assumptions.
The only tricky part is that you have to qualify credit-wise for the loan.
The good side is that this does not require money down.
So again even car assumptions may require that you have a good credit score for it to work.
However, there are some advantages of purchasing a car and making a down payment at the time of purchase.
When you buy a car and make a down payment, it usually leads to low-interest rates which directly gives you low monthly payments.
This is however not possible for everyone because you may not have much money to make those down payments.
How is this possible and what do you need to do to if you decide to go for this option? Here are 4 points you can use starting today.
1.
If you do not have a credit account such as a credit card, establish one to get some sort of credit history before applying for an auto loan.
There are two types of credit cards you can apply for.
These are secured and unsecured credit cards.
It is very difficult to get approved for an unsecured credit card without having any sort of credit history.
So we would advice you consider getting a secured credit card instead.
Over a period of 6-12 months you'll begin to build your credit score.
It is important to confirm with your bank that issues you with the credit card that your credit information will be reported to the credit reference agencies.
The thing is that some banks do not report this information to the reference bureaus if they give you a secured credit card.
2.
Lenders who give no-money down car loans require you to have a good credit score.
It's as such important to check your credit report before completing your auto loan application.
To improve your credit, minimize credit enquiries, pay more than the minimum balance payments and make payments in time.
So as you can see you have plan this ahead of time, ideally 12 months ahead if you want to buy your this way.
3.
If your situation is so bad that getting any of the above two to work out, or you do not have the time to build or repair your credit history, then try to get a relative or a very close friend to co-sign the loan with you.
The decision of the loan lenders will be dependent very much on the credit rating of the co-signer.
If they happen to have an excellent credit score, the lender may simply give you the loan without any problems at all, and without asking you for any money down at all.
4.
This is the last option we know of if you want to by a car and you do not want to put any money down: car assumptions.
This does not happen very often.
However, if you know someone who is trying to get rid of their car, you can assume their car loan.
First, discuss it with them on a personal level.
Then you can contact the lender and enquire if they allow car assumptions.
The only tricky part is that you have to qualify credit-wise for the loan.
The good side is that this does not require money down.
So again even car assumptions may require that you have a good credit score for it to work.
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