If you have no credit you will likely have to put down a larger down payment on your car. How much you will need to put down depends on the lender and the type of car you are looking to purchase. Many lenders will require a minimum down payment of 10% but some may go as high as 20%. Keep in mind that the larger your down payment is the more likely you are to be approved for a loan.
If you are looking to finance a new car your best bet is to go to a dealership that specializes in working with people with no credit. These dealerships will be more likely to work with you to get you approved for a loan. If you have a trade-in you may be able to use that as part of your down payment.
If you are looking to finance a used car your down payment may be lower. Many lenders will require a minimum down payment of 5% but some may go as low as 3%. Keep in mind that the lower your down payment is the higher your interest rate is likely to be.
No matter what type of car you are looking to purchase be sure to shop around for the best loan terms. Get quotes from multiple lenders and compare interest rates and down payment requirements. Be sure to read the fine print and ask questions if you don’t understand something. By taking the time to do your research you can be sure that you are getting the best deal possible on your car loan.
How much money should you put down on a car if you have no credit?
It is suggested that you put down at least 10% of the car’s total value.
