What Do I Do If The Dealer Turned Me Down For A Car Loan?

Posted by Dewey Kearney on December 22, 2010

Over the next couple of weeks we want to take some time to answer some of the more common Google and Yahoo search questions that brought people onto  the www.1-800badcreditblog.com website.

This was a good one:   What Do I Do If The Dealer Turned Me Down For A Car Loan?

This is a very common problem with people whose credit score is below 610.  Most dealerships only work with major lenders and with the bad economy they have really begun to reject those lower credit scores.

Now, if you know that you have a lower than average credit score should you go through a dealership and even try?  Truthfully – NO.  Here’s why:

Even if you are approved the dealership has the right to tack extra percentages onto the loan (which they won’t reveal to you).  Anything OVER what the bank granted is profit for them!  So if the bank offers you 15% and the dealership bumps it to 17% (and you sign the contract) that’s profit for them, and you’ll never even know you got screwed.

We keep saying this over, and over, and over, but your best option is pre-approval.  With pre-approval you’re approved by a lender and given the EXACT percentage and amount you can borrow.  This gives you way more bargaining power at the dealerships.  They will know that you don’t have to purchase from them because you have your own financing.  This means they have to play fair or risk losing the sale altogether!

Bottom line.  If you’re score is 620 or below then contact a lender like Instant Car Loan.  They specialize in lending to people with your credit scores and you have the best chance of getting a fair rate, and not getting screwed by a dealership.