Financing a Car Loan With 600 Credit Score

Financing a Car Loan With 600 Credit Score

Posted on April 21, 2023

If you're going to buy a car with 600 credit score or less, you have options available but it will be an uphill struggle.

Our goal is to give you the information you need to secure a fair and affordable car loan with 600 credit score.

What Happened to Your Credit?

This is a question that needs to be addressed before you move on; get access to your credit report by signing up with TransUnion and Equifax free credit reporting service.

Credit scores can range from 300-to 800, and the average Canadian credit score is above 650, so you have to look at your credit report for potential errors.

Errors do happen and can bring your credit score down.

These mistakes are not going to disappear on their own. Your credit report is fluid and tracks all of your financial dealings for the last seven years, so you need to deal with the issues head-on.

The law requires the credit reporting agencies to remove errors via their official dispute process.

Still, you will need to make the agency aware of the error before they do anything.

If you have unpaid debts or missed payments, you need to start paying down those debts as quickly as possible.

This is of particular importance if any of your debts have gone to collection; unpaid debts are the leading cause of low credit scores and need to be taken seriously.

Once your accounts are paid off and brought up to date, your credit score will start to improve and you won't even need to finance a car loan with 600 credit score!

Figuring Out Your Budget

After you have dealt with the causes of your low credit score, the next thing you will need to look at is your budget. Lenders are going to focus on your income and how much disposable income you have.

If you have a considerable amount of income, lenders will be willing to overlook your low credit score.

The majority of lenders will not approve a loan to a borrower with a debt-to-income ratio exceeding 35%, so keep that in mind, and you will be fine.

With rising gas prices, you should try to buy a vehicle that is fuel-efficient; the last thing you want to do is allocate the bulk of your income to buying gasoline for your car.

Where to Finance a Car Loan With 600 Credit Score

You may come across websites online that offer bad credit auto loans, but these deals are not competitive; you should go through a local dealership.

The dealership will be able to help you get approved for a car loan with a 600-credit score. While speaking with the dealership, they will show you how to repair your credit, so you never have to take a bad credit car loan again.

One of the key benefits of working with the dealership is having an inventory of cars you can choose from; there is a chronic shortage of cars, so this inventory is going to help make your shopping experience a pleasant one.

If you're ready for a car loan in Southern Ontario, we'd love to help with that! simply fill in the form below to get started.