What interest rate would you expect from dealer financing with no credit?

[jtvang125]

Something like a used car from a private dealer or franchise dealer? Down payment will be $10k and the rest financed. Price range will be $20-25k.

 

[Gillbot]

damn, $25 car after 10k down? Why not save for a few days and pay the extra $25?

That aside, as high as they can get you to sign off on.

 

[lastig21]

Before we got married, my wife had no credit and tried to buy a car on her own (new Accord from the local Honda dealer). The lowest we could talk them to was 12.5% with a "ghost" history. My local CU gave her 5.9% with me as a cosigner. This was late 2005. I've no idea what to expect from the credit markets now.

 

[chorb]

Something like a used car from a private dealer or franchise dealer? Down payment will be $10k and the rest financed. Price range will be $20-25k.

I was in this situation back in June of 09, my bank wouldnt give me a loan (because I had little credit history), while I could have probably shopped around for a CU that would give me a better rate, carmax (who I bought from) gave me a 8% offer which I took. I paid 10K down, financed the other 10K.

 

[SSSnail]

Expect around 10%. If this is your first car, watch for the shady "financing the whole thing" that some rats will pull.

Basically, they'll put everything on finance, and then deduct your 10K afterward. A lot of first time buyers fall into this trap. Make them finance whatever is left AFTER taken out your 10K. So let's say TTL comes to 30K, you should have to finance only 20K.

 

[Fenixgoon]

damn, $25 car after 10k down? Why not save for a few days and pay the extra $25?

That aside, as high as they can get you to sign off on.

i read it as 20-25k car with 10k down.

 

[Jumpem]

12%.

 

[satyajitmenon]

Expect around 10%. If this is your first car, watch for the shady "financing the whole thing" that some rats will pull.

Basically, they'll put everything on finance, and then deduct your 10K afterward. A lot of first time buyers fall into this trap. Make them finance whatever is left AFTER taken out your 10K. So let's say TTL comes to 30K, you should have to finance only 20K.

+1

Negotiate the out-the-door price before you talk about financing. If they try to throw that into the mix, tell them you'll discuss that after you've made a decision of model/specs/price.

When I was in the market for a used truck, figured I'd check out a new tacoma at the local stealership just for the heck of it... First off, they took 3k off their advertised price (which was ridiculous anyway). And then when I told them it was still too rich for my taste, they brought in their finance "expert" who basically said "what monthly payment work for you? I'll set it up." No mention of tenure of course. And when he saw I wasn't budging, said he'd take off another 2k if I made the decision right there at that moment... I was like "WTF??!!"

Crap. Didn't realise rant mode was on.

/rant mode off.

 

[Zap]

One friend that had BAD credit got around 18%. Each car he bought after that (in around 3 year intervals) dropped his interest rate by around 5%. He basically turned his bad credit into good credit, but took around 3 cars and 10 years.

Another friend with NO credit got around 14% on the first shot. I think now he's getting around half that, two cars later.

 

[postmortemIA]

20K is new car price, 25K for sure

don't tell them about credit until you are set on the price.

if I were you I'd use part of that that $10K to better my credit, instead all for downpayment

 

[ecom]

Dealership offered me a 9.6% loan for $11k. I lol'd. Next day I went to the credit union, signed up for membership with a $10 deposit and approved a loan at 3.25% up to $12k.

 

[DainBramaged]

Dealership offered me a 9.6% loan for $11k. I lol'd. Next day I went to the credit union, signed up for membership with a $10 deposit and approved a loan at 3.25% up to $12k.

Uh...when??

OP: I have only minimal credit (credit card for two years + car loan for 6 mos, all in good standing) and I got $16,000 from the bank @ 9%. I'm going to guess that you will get a percent or two higher.

 

[ecom]

Uh...when??

OP: I have only minimal credit (credit card for two years + car loan for 6 mos, all in good standing) and I got $16,000 from the bank @ 9%. I'm going to guess that you will get a percent or two higher.

That was Dec 2006 and it was for 36 month loan. Their new car rate has fallen since and is now 2.99% for 36 months.

 

[DesiPower]

My 1st car, I paid close to 17% with 50% down

 

[Imported]

I have very good credit and I was offered something like 6.9% from the dealer, which I took. Car paid off 3 months later so it didn't really matter. On the other hand, my credit union offered like 16%.. wtf.

 

[chin311]

my first car loan was on a new car, was 15k-ish, i only put 1500$ down and paid 9%. no co-signer around 20~ years old at the time.

 

[ElFenix]

first car right after college was about 7%, though i had a good history of paying the balance on credit cards every month and a job history for a while at the time.



best advice: get credit elsewhere before going to the stealership. if the stealership can beat the banks and credit unions, by all means use their financing. if not, use someone else. and that's always the case. don't forget that there is often a rebate in lieu of financing special.

 

[CrimsonWolf]

My first car loan was about 8% from Chase for $18,000. However, I had about 3-4 years of credit card history. This was in 2007.

I let the dealership give me a financing offer because they were running a cash-back incentive with dealer financing. The came back with 12.99% and refused to budge. I just loled at them.

 

[HarryLui]

Go to credit union and see what they can do for your first.

 

[angry hampster]

Go to credit union and see what they can do for your first.

Definitely do this, and get a co-signer if you can.

 

[PhoKingGuy]

I qualified for VW 0% straight out of college, though I was a lease return

 

[V00DOO]

Go to credit union and see what they can do for your first.

I just received a letter from my Credit Union offering 2.9% financing up to 36 months on car purchase. Of course I have good credit. You should shop around for the best rate before buying and credit union is not a bad place to start.