Bad Credit Car Loans in 2025

The best car loans for credit scores 580 and below

Headshot of Lauren Nicholson
Written by
Lauren Nicholson
Updated March 04, 2025
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How Does LendingTree Get Paid?

LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
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CarMax: Best for convenient used car financing

5.75%

24 to 72 months

$500 - $100,000

No minimum credit score

Pros
  • If you find a better rate within three days of getting your loan, you can back out at no extra cost
  • 90-day/4,000-mile limited warranty on cars
  • Free car delivery, in some cases
  • Check rates without impacting your credit
  • Can add a co-borrower to your loan to increase approval odds
Cons
  • Can only use CarMax loan on CarMax car
  • Expect a rate as high as 28.00% if you have bad credit
  • Not available in all states

What to know

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CarMax sells used cars online and in-person at more than 250 stores. As CarMax’s in-house financing arm, CarMax Auto Finance is only available at CarMax dealerships.

CarMax offers some great perks for car buyers. One of them is its Three-Day Payoff Program. If a competitor offers you a cheaper rate within three days of your car purchase, you can back out of your CarMax loan with no extra fees. Plus, you could get your car delivered to your home for free if you live within 60 miles of a CarMax dealership in certain areas.

Since CarMax only sells used cars, a new car is off the table.

How to qualify

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CarMax does not have a minimum credit score requirement, but you can only use a CarMax loan to buy a car from a CarMax store.

CarMax does business in 41 states. There are no CarMax stores in:

  • Alaska
  • Arkansas
  • District of Columbia
  • Hawaii
  • Montana
  • North Dakota
  • Vermont
  • West Virginia
  • Wyoming
See Personalized Results Read Our Expert Review

OpenRoad Lending: Best for car loan refinancing for bad credit

5.49%

36 to 84 months

$7,500 - $100,000

460

Pros
  • Rated 4.5/5 stars by LendingTree users who refinance with OpenRoad
  • One of the lowest credit score requirements on the market
  • Allows you to apply with another person for better approval odds
Cons
  • Doesn’t offer loans for car purchases
  • Can take seven to 10 business days to pay your current lender
  • May charge an origination fee (up to $299)

What to know

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If you want to refinance your car loan with bad credit, consider OpenRoad Lending. OpenRoad’s credit requirements are some of the lowest you’ll find, and you can boost your odds of approval by applying with a co-borrower. Plus, borrowers on the LendingTree marketplace give OpenRoad Lending high marks for customer satisfaction.

OpenRoad only offers car loan refinancing, so you can’t work with OpenRoad to borrow money to buy a car. And if you need to refinance fast, consider other car loan refinancing lenders — OpenRoad’s funding timeline is on the slow side.

How to qualify

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To refinance your car loan with OpenRoad, you must meet the following requirements:

  • Credit score: 460+
  • Income: $1,500+ monthly, ride-sharing income doesn’t qualify
  • Car requirements: Must be eight model years old or newer, have 140,000 miles or less. Can’t be a commercial car, motorcycle, RV, Oldsmobile, Daewoo, Smart Car, Isuzu or truck larger than 3/4 ton. Car must still be manufactured.
See Personalized Results Read Our Expert Review

Capital One: Best dealership loans for bad credit

5.59%

24 to 84 months

Starting at $4,000

500

Pros
  • You can check rates without dinging your credit
  • Auto Navigator car shopping can help you find your next ride and get prequalified at the same time
  • Can manage loan online and via mobile app
Cons
  • Doesn’t offer loans if you’re buying your car from a person (not a dealer)
  • Capital One only works with specific dealerships

What to know

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If you’re looking to buy a new or used car at a traditional dealership, check out Capital One. Capital One’s Auto Navigator tool allows you to find cars at local dealerships and check your rates at the same time.

Capital One only requires a minimum credit score of 500. However, you can only use Capital One auto loans at select partner dealers.

How to qualify

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Capital One requires a credit score of at least 500. The following vehicles are ineligible for financing:

  • Cars worth less than $4,000
  • Oldsmobiles, Daewoos, Saabs, Isuzus
  • Cars with branded titles
  • Cars that are older than 10 years and have more than 120,000 miles (in most cases)
See Personalized Results Read Our Expert Review

Autopay: Best for stretching out payments

4.85%

24 to 96 months

$2,500 - $100,000

580

Pros
  • Rated 4.6/5 stars by LendingTree users who use Autopay
  • Some of the longest repayment terms on the market
  • Check rates without affecting your credit
  • Can buy from a dealership or from a private seller
  • Allows you to apply with a co-borrower for better approval odds
Cons
  • Highest credit score requirement on our list
  • Loan requirements and fees vary by partner lenders

What to know

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If you need to stretch out your payments on a new or used car, consider working with Autopay. In addition to extra-long car loan repayment terms, Autopay also offers prequalification. This allows you to see your potential rates with no impact on your credit score. Plus, while other loans only allow you to buy from a dealership, Autopay offers loans for private party purchases.

Know that Autopay won’t directly fund your car loan — it partners with lenders who offer car loans. And some of those lenders charge fees of up to $400, so you may need to shell out some extra cash to pay for fees.

How to qualify

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Autopay connects borrowers to partner lenders and financial institutions. These partners all have different eligibility requirements.

To use the marketplace, you and the vehicle you’re financing must meet the requirements below:

  • Credit score: 580+
  • Income: At least $2,500 per month
  • Vehicle restrictions: Car must be less than 10 years old and have no more than 150,000 miles
  • Administrative: You must provide your driver’s license, insurance, proof of income and residence and a payoff letter if you’re refinancing
See Personalized Results Read Our Expert Review

What to know about bad credit car loans

You can buy a car with a bad credit auto loan, but you’ll likely pay high interest rates. High rates mean large monthly payments and an expensive loan. If you can’t afford your monthly payments, the lender can legally take your car.

Here’s how to make sure that doesn’t happen:

1. Make sure your new ride fits in your budget. Use an auto loan calculator to understand the true cost of your loan, including interest.

2. Read your loan contract. Yes, read it, and ask questions if you don’t understand anything. Watch out for balloon payments that make your monthly payments cheap at first but expensive at the end of the loan.

3. Come prepared. Be ready to negotiate the price of your car. If you’re looking at pre-owned cars, know your rights when buying a used car from a dealership.

On this page

 Avoid buy here, pay here car lots

Many bad-credit borrowers turn to buy here, pay here car lots because they offer loans for bad credit (if they check your credit at all). But these loans tend to come with predatory rates that make monthly payments expensive. Rates this high can land you in a cycle of debt where you need to take out more loans to pay off the first one.

Car loan rates by credit score

Lenders use your credit score and debt-to-income ratio to decide what car loan rates to offer you. You can see what rates to expect based on the average APR for used and new cars for borrowers with similar credit scores.

Credit scoreAverage new car APRAverage used car APR
Super prime (781-850)5.08%7.41%
Prime (661-780)6.70%9.63%
Nonprime (601-660)9.73%14.07%
Subprime (501-600)13.00%18.95%
Deep subprime (300-500)15.43%21.55%

Source: Experian’s State of the Automotive Finance Market Q3 2024

How to find a bad credit car loan with LendingTree

  1. Check your credit score. Get your credit score for free with LendingTree Spring. Plus, we’ll give you tips on how to improve your credit (which will save you money on your car loan).
  2. Let LendingTree do the shopping. Take the hassle out of comparing rates. With one quick form, you could have offers from up to five lenders from the nation’s largest lending network. Checking rates is free and doesn’t hurt your credit score.
  3. Compare and save. Once you have your offers, you can customize them to fit your budget. If you like what you see, you’ll finalize your loan directly with your lender.
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Understanding your car loan offer

Whether this is your first auto loan or your fifth, understanding car loan offers isn’t exactly easy. Here are some definitions to help:

APR: Your APR shows you how much your loan costs, including interest and fees. The higher your APR, the more expensive your loan.

Repayment terms: Your loan term is how long you have to pay off your car. Car loan terms generally range between 12 and 84 months. Choosing a longer term can mean a lower monthly payment, but you may pay more interest overall.

Fees: Car loans come with fees. Some are mandatory, like registration fees and sales tax. Other dealer fees, like warranties and protection packages, are extras you can decline.

Lender reputation: Unfortunately, predatory lenders tend to target borrowers with bad credit. As of this writing, you can check the Consumer Financial Protection Bureau (CFPB) complaint database to see how your lender does business before signing any paperwork. You can also read lender reviews to confirm that other consumers have had a positive experience with your lender.

Prequalification and preapproval: Auto loan prequalification estimates your eligibility based on a soft credit check that doesn’t affect your credit score. It gives you an idea of what to expect with loan offers. Preapproved auto loans go one step further. They involve a hard credit check that will slightly hurt your credit score, but provide a clearer picture of what loan terms to expect.

 Crunch the numbers

Chief credit analyst Matt Schulz warns borrowers to fully understand what they’re paying for before signing any paperwork. “Make sure you understand all of the major costs associated with the loan,” he says. “Along with higher interest rates, bad credit car loans can also come with higher fees and other fine print that must be taken into account when comparing offers.”

Expert insights on bad credit car loans

“Don’t just take the first car loan offer you find. Even with bad credit, you can benefit from comparing offers from multiple lenders. It is important to temper your expectations around those loans, of course. With crummy credit, you’re not going to get that sweetheart deal you’re hoping for. However, shopping around can still help you save money.” — Matt Schulz, chief credit analyst

Matt points out that no two loans are alike. Every lender has its own way of calculating rates. Just like insurance, you have to compare rates before you can be confident you’re getting the best deal.

Here are other ways to avoid a lemon of a car loan:

→ If a loan shows a range of possible rates, pay attention to the maximum, not the minimum. Borrowers with a bad credit history tend to qualify for rates on the high end of the range.

→ You might have a high rate, but if you pay your car loan off fast, you can pay less overall interest.

→ Lenders may not be willing to give you a big loan, so consider limiting your search to used cars.

→ Bad credit car loans often come with high documentation (or doc) fees. This can make a car look cheaper than it really is. Ask for the out-the-door price so you know exactly what to expect.

Tips to improve your chances of being approved for a car loan

  • Get a cosigner. If someone with good credit is willing to back you up, consider adding a cosigner to your car loan. Late loan payments will hurt both your scores, so make a plan to avoid missed payments, like by setting up automatic payments.
  • Make a big down payment. Steer clear of zero-down bad credit car loans. Putting down a large down payment can make it easier to get approved.
  • Improve your score. You can save a lot of money and boost your approval chances by improving your credit score before you buy your car. It’s not an overnight fix, but waiting to get a car loan until you have at least good credit (670+) could save you thousands in interest.

How we chose the best bad credit car loans

We reviewed 25 auto lenders to determine the overall best four bad credit car loan lenders. To make our list, lenders must offer auto loans to borrowers with credit scores 580 and below. From there, we prioritize the following factors:

  • Accessibility: We choose lenders with auto loans that are available to more people and require fewer conditions. This may include lower credit requirements, wider geographic availability, faster funding and easier and more transparent prequalification, preapproval and application processes.
  • Rates and terms: We prioritize lenders with competitive APRs, fewer fees and greater loan options for repayment terms and amounts.
  • Repayment experience: For starters, we consider each lender’s reputation and business practices. We also favor lenders that have self-service payment options (such as a mobile app), provide reliable customer service and offer unique perks.

According to our systematic rating and review process, the best bad credit car loans come from OpenRoad Lending, Capital One, CarMax and Autopay. LendingTree reviews and fact-checks our top lender picks on a monthly basis.

LendingTree partners with dozens of auto lenders, but partners and non-partners receive equal treatment in our scoring and review process.

Frequently asked questions

It’s possible to get a car loan with a 500 credit score, but the lender might have other requirements, too. You might also need to earn a certain amount of money or have been at your job for a specific length of time.
 
The best way to see if you qualify for an auto loan is to prequalify. It doesn’t require a hard credit hit, so prequalifying won’t negatively impact your credit.

There is no standard credit score for buying a car with a loan. Some lenders don’t require a specific credit score at all. But the easier it is to get a loan, the more expensive that loan will probably be. Even if you have bad credit, shop around and compare offers to find the loan that’s best for you.

Generally, buy here, pay here car lots are the easiest places to get car loans. That said, you should look for cheaper options. Buy here, pay here dealerships are often predatory, meaning that their loans are very expensive.
 
Instead, prequalify online with a few lenders to see if you can find a better option. You can also skip loans altogether and pay cash for a car.