5 Best Auto Loans for Bad Credit (2023)

5 Best Auto Loans for Bad Credit (2023) – Finding financing options when you have poor credit can be challenging. Numerous lenders are hesitant to extend loans to individuals with bad credit or no credit history. However, there are lenders and loan marketplaces available that are willing to assist you in finding the best auto loan options despite your credit situation.

We have curated a concise list of reputable lenders and loan-matching services that specialize in low-credit and no-credit auto loans. We have thoroughly assessed these companies to ensure that we are providing you with credible and non-predatory options.

Best Auto Loans For Bad Credit

These lenders have set low credit score requirements, and they often consider alternative data such as annual income and debt-to-income ratios as part of the loan approval process. This approach allows for a more comprehensive assessment of your financial situation, increasing your chances of loan approval.


5 Best Auto Loans for Bad Credit
5 Best Auto Loans for Bad Credit

This auto loan matching service is specifically tailored to assist individuals with poor credit in qualifying for financing. They specialize in providing loans to those with bad credit, including individuals with a history of bankruptcy or no credit history at all.

Upon completing their application, this service works diligently with lenders and dealerships on your behalf to secure the most favorable loan terms available. Since its establishment in 1998, this company proudly claims to have helped over 1 million customers, showcasing their extensive experience in the field.


Credit scoreno credit is needed
Down paymentas low as 0%
Annual income$12,000
Bankruptcies allowedYes
Loan values$3,000 – $45,000
Repayment terms36 – 60 months
Average approval time24 – 48 hours

How Much Does It Cost?

1800FreshStart does not impose any application fees on its customers. Instead, the company generates revenue by selling sales leads to lenders.

It’s important to note that the lenders themselves will charge you interest on your loan, known as the Annual Percentage Rate (APR), and there may be additional fees involved. Therefore, it is crucial to carefully review the complete terms and conditions of your loan offer. Please be aware that 1800FreshStart does not publicize the specific APRs that customers have received.

Lending Tree

5 Best Auto Loans for Bad Credit
5 Best Auto Loans for Bad Credit

This loan matching service provides a range of loan options, including auto loans. Once you complete your loan application, they will connect you with up to 5 lenders from their extensive network, which comprises over 500 lenders.

Their wide network enables them to accommodate loans of up to $4 million, although this is uncommon for auto loans. Additionally, they strive to offer competitive Annual Percentage Rates (APRs). Moreover, you can expect to receive loan approval in as little as 1 minute.

πŸ“š Read our full review of Lending Tree’s auto loan matching service.

Credit scoreno minimum credit score is required
Down paymentat least 10%
Annual incomeN/A
Bankruptcies allowedYes
Loan values$250 – $4 million
Repayment terms12 – 84 months
Average approval time1 – 60 minutes

How Much Does It Cost?

Lending Tree does not impose any charges on you. Instead, they receive a predetermined fee from each recommended lender.

The lender generates revenue through the interest (APR) and other fees, such as a loan origination fee. Currently, Lending Tree promotes the following minimum APRs based on loan types:

1.00% for new loans
1.00% for used loans
2.14% for refinancing

It’s important to note that if you have bad credit, your interest rates will likely be higher.

Lending Tree also facilitates lease buyouts, although the starting APRs for these loans are not explicitly advertised.


5 Best Auto Loans for Bad Credit
5 Best Auto Loans for Bad Credit

This company is renowned for its convenient “buy a car from your couch” service. In addition to vehicle purchases, Carvana also provides financing options.

With Carvana, you have the opportunity to borrow up to $100,000, and they offer a pre-approval process that does not have a negative impact on your credit. Furthermore, their vehicles come with a money-back guarantee, which includes the option to roll back the loan.

It’s important to note that Carvana’s lending services are exclusively available for Carvana purchases, and currently, they do not serve customers in Hawaii or Alaska.


Credit score450
Down payment0%
Annual income$4,000
Bankruptcies allowedYes
Loan values$1,000 – $100,000
Repayment terms36 – 72 months
Average approval time2 – 3 minutes

How Much Does It Cost?

Carvana generates revenue through its APR charges. They do not impose any loan origination fees or prepayment penalties. However, it’s important to note that they may apply fees related to your vehicle purchase, such as delivery fees.

According to feedback from some customers, the lowest reported APR is as low as 3.9%. On the other hand, the highest APR advertised for individuals with poor credit is 27%.


5 Best Auto Loans for Bad Credit
5 Best Auto Loans for Bad Credit

This loan matching service focuses on auto loans and enables you to compare up to 4 offers at once without affecting your credit negatively.

MyAutoLoan stands out as one of the rare matching services that offer loans for vehicles bought from a dealership or through a private party, such as purchasing from a neighbor. Moreover, MyAutoLoan provides low APRs for lease buyouts and refinancing, making them a suitable option for various types of auto loans.

MyAutoLoan is not currently available in Alaska or Hawaii.


Credit score575
Down paymentas low as 0%
Annual income$21,600
Bankruptcies allowedYes
Loan values$5,000 – $100,000
Repayment terms36 – 84 months
Average approval timeas little as 30 seconds

How Much Does It Cost?

MyAutoLoan is a matching service that offers a completely free application process. They generate revenue by receiving compensation from lenders for connecting you with them.

It’s important to note that each lender will apply an APR to your loan and may include additional fees, so it’s crucial to carefully review the terms of your loan offer.

MyAutoLoan advertises the following starting APRs:

  • 2.99% for new vehicles
  • 3.24% for used vehicles
  • 2.49% for refinancing
  • 5.99% for lease buyouts
  • 2.49% for private party purchases

These rates are based on repayment terms ranging from 37 to 60 months. Choosing shorter or longer repayment terms may result in higher APRs. Additionally, having bad credit will typically lead to higher APRs as well.

One Main Financial

5 Best Auto Loans for Bad Credit
5 Best Auto Loans for Bad Credit

If you’re seeking an alternative to a conventional auto loan, One Main Financial provides personal loans that can be utilized for purchasing vehicles. These loans are available in both secured and unsecured options, meaning you don’t have to use your car as collateral.

However, it’s important to note that these loans have limitations and can be costly. The maximum loan amount is $20,000, and the APRs vary between 18% and 35.99%.

Please be aware that One Main Financial does not offer loan services in AK, AR, CT, MA, RI, or VT.


Credit score560
Down payment$0
Annual income$7,200
Bankruptcies allowedNo
Loan values$1,500 – $20,000
Repayment terms24 – 60 months
Average approval time24 hours

How Much Does It Cost?

One Main Financial offers interest rates ranging from 18% to 35.99%. It’s important to note that they also impose an origination fee on all loans. According to their fee disclosure, this fee can be as high as $500 or 10% of your loan value.

A Comparison of the Best Auto Loans for Bad Credit

For a quick overview of the key features of each of the above-mentioned lenders and loan marketplaces, we’ve compiled the below table for your reference. Here, you can quickly find the loan/service that best fits your needs.

5 Best Auto Loans for Bad Credit

How to Find the Best Auto Loans With Bad Credit

Searching for an auto loan can be difficult when you don’t have the best credit. Lenders prefer creditors with good credit as they are more likely to repay their debts.

In the table below, you can see the most recent average interest rates for both new and used cars by credit score.

Average auto loan rates for Q1(January – March) 2023

Deep subprime300-50014.08%21.32%
Near prime601-6608.86%13.28%
Super prime781-8505.18%6.79%
*Actual interest rates are based on many factors such as state, down payment, income, and others.

So, when you have bad credit, how do you find an affordable auto loan?

Pitfalls to Watch Out For

Regrettably, individuals with bad credit may face potential exploitation by lenders and loan matching services.

Loans designed for those with poor credit often come with unfavorable conditions such as high fees (e.g., origination fees and finance fees), elevated interest rates, substantial down payment or income prerequisites, and restricted terms.

For example, LendingTree mandates a 10% down payment, One Main Financial imposes high APRs and fees, and MyAutoLoan requires a significant annual income.

Moreover, it is essential to be cautious of other predatory practices. These may include application fees, rate lock fees, the insistence on credit repair services, balloon payments, and overly enticing promises that seem too good to be true.

However, one potential advantage of obtaining an auto loan with bad credit is the possibility of refinancing in the future once your credit score improves.

πŸ“š Read Also – Best Personal Loan Companies In usa 2023

How to Improve Your Approval Odds

Let’s take a look at some steps you can take to improve your chances of loan approval.

  1. Get prequalified and avoid dealer upcharges and unnecessary hard inquiries.
  2. Buy less car: set a budget and stick to it, don’t let a dealer talk you into more car than you need.
  3. Put more money down: the more you put down, the less you finance, which means less risk for the lender.
  4. Shorten the repayment terms: financing for 60 months or less could lower your APR and expand your loan options.
  5. Contact your local credit union or bank: using established relationships can increase your approval odds.
  6. Improve your credit score: use services and tools to boost your score now, or wait for your credit history to age.
  7. Add a co-applicant: a cosigner with good credit can land you a loan when you can’t qualify on your own.
  8. Lower your debt-to-income ratio: try to pay down your debt and/or increase your income.

πŸ“š Read Also – Bluevine Small Business Loans Review

Bottom Line

While having bad credit may restrict your choices for auto loans, securing financing is still feasible. It is crucial, however, to remain vigilant against predatory pricing and practices. Fortunately, there are reputable lenders who are willing to collaborate with individuals with bad credit without imposing exorbitant fees.

Among the lending options listed above, you may find a suitable match for your needs.

Our Methodology

When assessing lenders and matching services to identify the best options for individuals with bad credit, several crucial factors were taken into account.


We specifically considered lenders and matching services that advertised minimum credit scores below 580. Additionally, we examined their policies regarding past bankruptcies.

Down Payment:

While supporting low credit scores is important, a hefty down payment can pose a challenge. Most of the lenders and matching services we evaluated offer loans with zero down payment. However, Lending Tree requires a reasonable down payment of 10%, which amounts to $3,000 on a $30,000 loan.


Income requirements are a vital consideration for loans aimed at individuals with poor credit. Some entries on our list had no annual income requirements, such as Lending Tree. Among those that did, the highest requirement was $21,600 for MyAutoLoan, which is still well below the median per-person income in the US.

Loan Values:

Bad credit often results in borrowing limits, but most lenders on our list offer loans of $100,000 or more. The exception is One Main Financial, whose loan limit is $20,000, which can still be helpful for purchasing used vehicles.


Acquiring a loan with poor credit generally entails a high APR. While several options on our list offer low-interest rates, these rates are typically reserved for individuals with excellent credit. However, most matching services provide multiple lender offers, allowing borrowers to choose the lowest rate available. Direct lenders, such as Carvana and One Main Financial, openly advertise their highest rates, reaching 27% and 35.99%, respectively.

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