It is very difficult to qualify for car loans with bad credit. Credit scores reflect the financial behavior of borrowers in a major way— as a result of which they have emerged as such an important yardstick for determining the repayment capacity of the borrower. Good credit scores imply that the borrower has been regular with his repayment of previous loans and credit card bills, as a result the present lenders believe that he will be able to repay on time, this time as well. 

 Poor credit scores just mean the opposite. The lenders are generally not ready to enter in to a loan agreement with someone who has not been regular with his repayments earlier. So borrowers with poor credit generally have to settle for high interest loans as lenders want to get back as much as they in the first installment itself.  Things might get more difficult with you looking for no down payment auto loans with bad credit.

The money paid up front by a borrower turns out to be a crucial factor in the whole borrowing process. It is always advisable that you pay up at least 20-30 per cent of the total money borrowed by you.  The more money you owe upfront the lesser of the loan are you left with. Moreover, a higher down payment also helps you create an impression on the lender about your repayment capacity. As such a heavy down payment comes in very handy when you have bad credit scores.

But what if you are looking at getting a car loan with no down payment and bad credit? Would you be able to get it? The answer, obviously, is yes. But you have to dig deeper in order to find such lenders. Traditional banks and credit unions do not even consider loan applications from borrowers with bad credit. Things might get more difficult when you are looking for guaranteed auto loan no down payment with poor credit.  You can turn to subprime lenders for help in these cases. 

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