Applying for any kind of loan is difficult without a good credit score - but having no credit score at all can make it even harder. Luckily, there are a few ways to enhance your chances of getting a car loan with no credit check. In fact, taking out and repaying a loan this way can even help rebuild your credit score - so it could help you apply for other loans and finance in the future. So follow these five tips to getting no credit check car loans and start rebuilding your credit with a brand new car!
1. Save for a deposit
Getting as big a deposit as possible is a must. With no credit check car loans your interest is likely to be very high, and a larger deposit can reduce your overall cost by a significant amount. It will also show loan dealers that you are serious about applying and can keep up the payments.
2. Pay your bills
Do everything you can to garner evidence for your financial stability. As they're not checking your credit, paid bills are a good way to prove your dependability. They may even check with your providers, and will then see that you can keep up payments despite not checking your credit history.
3. Prepare your paperwork
Since the dealer is not checking your credit score, you need to be able to provide proof of a consistent and stable income from employment to prove you can keep up the repayments. Gather everything you can: paychecks, tax documents, bank statements, paid bills and any other documentation you may have for outstanding loans are great starters. It will prove to dealers that you are financially stable and are able to keep on top to repayment plans, without them seeing your credit score. It may even keep down the cost of the repayments.
4. Find a co-signer
This is not essential, but it can help your application. Having a co-signer with a great credit history can increase the chances of your application being successful. You should make sure that you remain as the primary signer, though, so that you will still technically own the car at the end of the payments.
5. Consider refinancing your auto loan
Once you've been making repayments on your no credit check car loan for over a year, you might want to consider refinancing it. This sounds strange, but if your credit report has improved since you first took out the loan (which it should do if you make all your payments in full and on time) then you may be able to get a better deal elsewhere and reduce your interest, loan term and overall costs. If you're planning on doing this, it's worth checking if there are any minimum payment terms or transfer fees before you sign up for your initial no credit check loan. This could help you out if you decide to refinance in the future.