If you have been shopping new or used cars for sale lately you might have seen several offers of no money down on a car near you. However when it comes time to talk credit score, you may find the once overly eager salesmen suddenly hesitant to talk further. What gives? What credit score do you need for no money down on a car anyways?
Buying Used Cars with No Money Down
There aren't many used car finance companies that even offer true zero down used car offers, but if you find one the credit score you would need would be 680+ or even over 720+ which is considered 'prime' credit. It's the same sort of offer you see on many 0% financing on new car specials. The sort of deal where only a select few qualified credit ratings. However that doesn't mean you cannot get cheap used cars without having money in pocket.
The trick is trade in value. The auto finance companies take your used car as your down payment and in exchange you pay them zero. But this only works for many if their old used truck or car has value. What if it's a piece of junk? You can still buy used cars, no money down, but it requires a bit more number shifting and possibly extra state tax.
Say you need $1,000 down but your trade in is only worth $500, with the used car you want to buy costing you say $5,000. To make the gap, the dealer gives you $1,000 on your trade in, but charges you $5,500 for their used car. The net cost is still the same but you pay nothing out of pocket except maybe state sales tax on that extra $500. By doing it this way, you can get zero down for any credit score as long as you have some sort of trade in.
New Cars No Money Down Options
Why could it be easier to get a new car with no money down and bad credit then a used car? Because bad credit auto financing companies not only accept trade in value like they would for cheap used cars, but also have a second even easier option for people who might not have a trade in.
That option of course is cash rebates. You might have to watch your monthly sales but time it right and you can get some nice fat cash rebates on new cars for sale to put towards a down payment. And unlike financing offers, cash rebates don't care what your credit score is so even if you have poor credit you can use the rebate as a down payment and finance the rest. To find out more on how you can get financed with zero down, click on the banner below.