Buying a car from a private individual with bad credit


Car buyers with good credit can purchase a vehicle from virtually any seller they choose, but if you have bad credit, obtaining financing for a private loan or anywhere else an authorized dealer can be very difficult.

Private Party Car Loan Questions

Here has Auto Express Credit we are frequently contacted by borrowers with bad credit asking if we are able to arrange a loan so that they can purchase a vehicle privately. Here is a message we received last month:

“I would like to know if I can get a loan for a car that is being sold by a private owner, not a dealership. Thank you.”

The short answer to that would be “no”. But here are the reasons.

Private car loans

To start, Auto Express Credit is not a lender, that’s not what we do. The service we offer matches buyers with less than perfect dealer credit in their area who work with borrowers in credit difficulty. These dealerships are signed up with subprime lenders. These lenders consider other factors besides the applicant’s credit rating and look for ways to approve them for an auto loan.

Second, these subprime lenders — those who offer car loans to people with bad credit — generally only work through licensed car dealerships.

Here’s why:

  • Since these loans have a higher risk of default (because they are offered to buyers with poor credit), subprime lenders usually require the dealer, who is acting as their representative, to verify income. , employment and residence of the borrower. This is done to ensure that the buyer can afford the loan. It is also a way to ensure that the information the borrower has entered on the application is correct.
  • These subprime lenders also require dealers to verify that the financed vehicle matches what the paperwork indicates. In other words, the dealer must correctly describe the age and mileage of the vehicle, its equipment (sunroof, automatic transmission, electric windows, etc.) as well as the type of title it has. The last point is particularly important, because these lenders will not finance any vehicle with brand title (rebuilt, flood damage, unknown mileage, etc.).

So it’s clear that a licensed auto dealership is an important part of the subprime auto loan process. It’s also easy to see why these lenders would no longer want to take the risk of offering retail loans directly to consumers without a third party (in this case, the dealership) verifying this information.

The essential

Due to the increased risks, borrowers in credit difficulty will generally not find a lender willing to finance the purchase of a vehicle from an individual.

Instead, if you have bad credit and need a vehicle, we want you to know that for nearly 20 years, Auto Express Credit helps buyers with credit problems get the car financing they need.

Not only do we simplify the process, charge nothing for service with no obligation, but we also have a nationwide network of qualified dealers to work with unique credit situations.

So do not hesitate any longer and fill out our simple and secure online form car loan application to start today.


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