Question: Can I get a decent interest rate with bad credit and no co-signer?

June 21, 2005

Hello Tony

Is it even possible to get a decent interest rate with bad credit and no co-signer?

They want over 21% which is crazy. How does one get past this, or is it the only way I will get a loan? They want a high down payment too? It's high down/high interest!

Thanks for the input

Deborah

Answer:

Hi Deborah,

The only way to get passed it is to establish good credit. In time you will be able to get a better financing deal. That may mean if you can't do any better, you have to pay the high rate and down payment. Just be sure to always make your payments on time.

If you bite off more than you can chew you will eventually start making late payments or no payments. At that point your credit is junk again. This is true with all your debts. So don't take on a payment you can't handle for the long term.

An alternative would be to simply buy a car for cash. It may not be as nice, but there are plenty of good car deals out there that can be had cheap. You just have to find them.

If you use the money you were going to use for a down payment you'll own the car outright, and you don't have to worry about making payments or anybody taking the car away from you for non-payment.

I've purchased many decent cars for $1,000 or less. they are out there, and these cars will last two or three years with minimal maintenance if you take it easy on them.

All my very best...

Tony Iorio