Getting a car loan as a first-time buyer with no credit history or bad credit



As a first-time car buyer with no credit or bad credit,* you might feel up against it.

That’s understandable.

Consumers with long and strong credit histories generally stand a better chance of getting financing from an auto lender, and may enjoy better financing terms and a greater choice of vehicles.

But now that we’ve aired some of the common realities of auto loan shopping as a first-time buyer, take heart.

Many auto lenders accept applications from first-time buyers, and guess what? Many of those consumers have limited or bad credit histories.

When you’re in one of these situations, there are a number of steps that may be taken to make the whole process easier.

Here are some simple tips:

  • Look for inaccuracies and errors in your credit reports that might affect access to credit. Even if you think you have no credit history, it’s worth checking. The Consumer Financial Protection Bureau (CFPB) gives details of how to request your reports from the major credit bureaus here.
  • Budget, with tools like budget and auto loan calculators, to estimate what you can afford to pay for a car, and how different financing terms affect what you may pay.
  • A down payment will reduce what you need to borrow and may also reduce what you pay in finance charges over the course of the loan. It may be a requirement from some lenders.
  • Adding an auto loan cosigner to your application might boost your chances of approval and, if approved, improve your loan terms.
  • Think about applying with different auto lenders. Once approved, compare the terms offered. You might want to apply for a preapproved auto loan with a lender like RoadLoans that enables approved applicants to know their loan terms before they visit the dealership.
  • Another option is to establish credit before seeking a car loan. See the CFPB advice for building credit in our “Car loans for first-time buyers” article.

Buying a car for the first time with no credit history or poor credit is not ideal but, with preparation, you may save yourself some valuable time and money.

Applying for a car loan with RoadLoans takes just minutes and you’ll receive an instant decision.

As a direct-to-consumer lender, our online process cuts out the middleman and streamlines the car-buying experience.

All credit types can apply and, if approved, there’s no obligation to activate the loan.

Apply for a car loan with RoadLoans.


* “Bad” or “Poor” credit generally is considered a FICO score around 600 and below by sources including the Consumer Federation of America and National Credit Reporting Association (reported by the Associated Press),,, Investopedia, and others. The Congressional Budget Office identifies a FICO score of 620 as the “cutoff” for prime loans. FICO scores are not the sole factor in lending decisions by and Santander Consumer USA.


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