If you have good credit, you can often buy a used car with no down payment in Los Angeles without a problem. But if you have bad credit and need an auto loan, you should know that a down payment is often a requirement for approval. Finding money to deposit isn’t always easy, but a down payment helps you in so many ways.
Down payment conditions for a car loan
Since you usually have to deposit money when you have bad credit in Los Angeles, you should know what are the down payment conditions in advance.
Subprime lenders – the type who are willing to work with borrowers with poor credit – typically charge a minimum of $ 1,000 or 10% of the vehicle’s selling price, whichever is less. Keep in mind that this can vary depending on the programs offered by a particular lender.
The down payment requirement at in-house financing dealers, such as buy here pay here, varies more widely. Although one is almost always required, the amount required differs as these places are often operated independently and based on the car you choose.
How a down payment helps
Did you know that a down payment makes a car loan more affordable? That’s right, having one lowers your monthly payment and lowers the amount of interest charges you will end up paying over the course of the loan.
Best of all, you don’t have to use cash only. If you have a trade, you can also use trade equity, or a combination of cash and trade equity, to increase your down payment even further.
While it’s okay to lower the minimum amount, the bigger the better. Not only does your loan amount go down, but you limit the time you spend upside down (when you owe more on the vehicle than it is worth), and increase your chances of getting approved for car financing with a bad credit. credit. Ultimately, it is a win-win situation for you and the lender when you make a larger deposit.
Are you looking for a dealer in Los Angeles?
If you have bad credit in Los Angeles, make sure you have a down payment ready to buy when purchasing your next used vehicle. Once you’ve done that and feel confident about purchasing your next car, we want to help you find financing.
Auto Express Credit works with dealerships across the country who have loan resources available to help people with bad credit, including those in and around Los Angeles. Find a suitable local dealer for you by filling out our simple and secure form auto loan application form today!