Auto Financing for Bad Credit

"Don't prejudge your credit." "Bad credit, no problem."

These are slogans you hear car sales advertisements use a lot when they are trying to get you to come in and buy a car. If you are willing to buy into what these advertisers are telling you, even if your credit tells them you are a bad risk, they can get you that loan to get you into a car because that is just the kind of great guys that they are.

Do you ever see those commercials and wonder, "What's the catch?" Well the catch is one that could make you feel pretty badly toward car dealerships. But is one you should be aware of before you let them set you up with a car dealership loan.

We are not saying that all "bad credit, no problem" offers are scams. But there is a plan that these people are working on some customers they get that are already struggling with their finances. And it is a scam that is not only ugly and underhanded, it is downright cruel.

It is designed to rob you of the money you put down on the car and your payments that you can make. And when you think that these plans are carefully designed to steal that money from people who are already struggling, it can make you a little sick when you see them say, "We can finance you a car even if you have bad credit."

Here is how the scam works:

• The commercials are designed to reach out to people who really need a vehicle to get out of a financial nightmare they are dealing with.  Because part of that nightmare is their credit has collapsed, they are desperate for someone to help them.  These commercials are there to offer that help when the car dealership is just out to victimize these people even more.

• 
  The dealership gets you to buy a used car.  They will be sweet and accommodating by assuring you they can finance the car even if your credit tells them you cannot afford the payments for very long.  In fact, they will try to get you to buy a car that costs more than you can afford.  They want you to default on that loan.

• The victim of the scam must put down a down payment.  Usually they are able to negotiate that down payment but they want something.
  

• The contract for the sale stipulates that if you miss one payment, they can repossess the car and keep the down payment and the payments that have been made so far.  You lose your money and they get the car back to sell again working the same scam over and over and over again.

It is a pretty ugly scam. So beware of bad credit offers from car dealerships and read the terms carefully.

You are better off working with a bank or financial institution that can give you some credit to get you into a car without trying to trick you like some of these "no credit, no problem" offers are trying to do.