Category Archives: Car Loans Bad Creidt

Fresh Start Program: Bad Credit Car Loans Milwaukee

Looking to start all over?  At John Amato Mitsubishi , if you have bad credit and live in the Milwaukee area we are here to help.  When you have a low credit score or not credit at all, most auto dealerships will treat you like a burden.  We see you as a customer.  Most times, most dealerships will tell you there is nothing they can do and send you on your way.  Having a bad credit score or no credit in Milwaukee area makes it harder to get an auto loan.  But, don’t worry it is not impossible.  Many problems with obtaining a car loan involve the dealership not having enough lenders that specialize in assisting people with low or no credit


How to get a car loan for people with bad credit in Milwaukee Wisconsin:

Having a low or bad credit score is difficult, and we understand.  If you are in this situation,  you need to work with a specialized lender or a car dealership like John Amato Mitsubishi that has the connections.  A specialized lender will usually be more understanding.  Here at John Amato Mitsubishi, we have several great relationships with lenders and our own in-house financing that can arrange a great car loan to get you re-established.

Step One

Apply For financing     This is featured throughout the website.

After that one of our specialist will contact you and discuss your options and appointment time to come in

Second Chance Finance Auto Loan after Default near Milwaukee

A credit default occurs when a borrower is unable to repay the credit.  And this reflects on your ability to meet timely payments, putting off lenders from offering you reliable car loans after Default near Milwaukee,WI.

But, do not worry, John Amato Hyundai and John Amato Mitsubishi work with a huge network of lenders who look at you current repayment potential and are willing to take a chance with you. This way , you get various affordable rates of interest on reliable vehicles.  You can take you time to discuss your options with one of our numerous credit specialists.  Whether you get a loan from one of our lenders or our in-house finance program, we report to the credit agency, so when you make your payments on time future lenders will be happy with the positive change to your credit score.

Our Second Chance Finance are two pronged:  We help you get into a car and we also assist on getting your credit score back on track. .  Another reason to choose John Amato Hyundai and John Amato Mitsubishi is our huge selection of used vehicles.

We offer a wide selection of sedans, trucks, SUV, minivans and  sports cars.  Our brand selection is not limited to Mitsubishi and Hyundai, we also carry Acura, Audi, BMW, Dodge, Cadillac, Chevrolet and more.  You can take a peak at our inventory online.  Our vehicles are carefully inspected before we take them in so you need not to worry about safety or upkeep.  Like our reliable car loans after default, our cars too come in various price ranges so that there is something for every need, taste, and budget.  We take the time to listen to your financial situation,and we work hard to find you a vehicle and financing plan that works.

Even if you had a bankruptcy, divorce, repossession on your record it is not a problem.  We feel that our customers deserve a second chance.  Talking about prices, we offer internet specials, extended warranty programs and other financial  perks to all of our clients.  So there is savings at every corner.  For more details on starting your transaction contact John Amato Hyundai or                 John Amato Mitsubishi to start the process.

How much should my downpayment be for Car loan

So, you’re ready to buy a car. You’ve done your research, sold your old car and found the perfect set of wheels. Now you’re wondering how much of a down payment to make when you have bad credit. Most people you ask say 20%, and that’s usually right.

In general, it’s wise to make a down payment of at least 20% on that new car — if you can afford it. If you can’t hit 20%, get as close as possible. It will increase your chances of getting a loan on favorable terms, keep your monthly payments low and make it less likely that you’ll find yourself “upside down,” or owing more than the car is worth.

Twenty percent seems high, right? Many people do buy a car with less. The average new-car buyer put down just $3,502 in 2014, about 11% of the average new car price of $33,000. Used-car buyers put down even less. Six grand for a down payment may feel like a hefty chunk of change, so why shell out?

There are a lot of reasons:

  • You may get better terms on your loan, including a lower interest rate.
  • You’ll increase your chances of getting approved for a loan.
  • The monthly payment will be lower, and you’ll pay less in total interest over the life of the loan.
  • You’ll have more equity in the car, increasing your feeling of ownership.
  • It helps you avoid owing your lender more than the car is worth or more than you’d get from insurance if the car is totaled.
  • A higher upfront payment will help keep your overall debt level manageable — but keep market conditions in mind.

Lower interest rate

A substantial down payment signals to lenders that you’re committed to the car and therefore represent a lower-risk borrower, so some lenders will give you a better interest rate.

Better chance of loan approval

If your credit score is less than excellent, a large down payment can help you qualify for financing. “Keep in mind that buyers don’t necessarily need all the money in cash. Two common ways to bolster the down payment are with a trade-in vehicle or with a cash rebate on the vehicle’s purchase,” says Brian Moody, executive editor at Autotrader. If your FICO score is 670 or below, you’ll have a better chance of getting a loan from a bank or credit union if you can put at least 15% down, according to the auto website

Lower monthly payments

More money down means less to pay each month, and less interest paid over the life of the loan. “If you can’t secure low financing for whatever reason, making a bigger down payment — or buying the car outright — can save you significant money in financing costs,” says Jason Allan, managing editor for Kelley Blue Book’s

More equity

The more you put down, the more equity you’ll have. One reason for the 20% benchmark: It’s about what a new car loses in value through depreciation in a year. “Depreciation is about 20.5% in the first year, so a 20% down payment essentially offsets the first year of depreciation,” says Ron Montoya, senior consumer advice editor at

Avoid being ‘upside down’ on your loan

If you make too small a down payment on a car, you could end up owing more than the car is worth. An extreme example: You’ve probably seen dealerships advertising zero-down deals. While these deals are popular, they can be risky.

With a 100%-financed deal, you’d owe more than the value of the car, because the loan would include the purchase price plus sales tax, interest and other fees. “If you put zero down, right off the bat the car is already worth less than the loan that you’ve taken out,” Montoya says.

That’s called being “upside down” or “under water,” and it’s financially dangerous. If you’re upside down, you may not be able to trade in the car if you want to buy a new one, or you may have to roll the amount you still owe into the loan for the new car. If you’re in an accident and your car is totaled, the insurance company’s payment — which is based on the cash value of the car — may not cover the full amount you still owe.

Keep debt level manageable — but consider market conditions

One final factor: Is it cheap or expensive to borrow money right now? When interest rates are high, you want to scrape up all the cash you possibly can to keep your loan (and the amount spent on interest) as small as possible.

But when interest rates are low, as they have been for several years, a smaller down payment can make sense. “When rates are low, even if you have money available to pay cash for the vehicle, the best option may still be to take out a loan. That allows you to keep the money, perhaps invested with a higher rate of return,” says Mike Buckingham, senior director of the automotive financial practice at J.D. Power.

If you can put your money to work and earn extra income from the investment, then a smaller down payment may be appropriate.


When it comes to car down payments, bigger is usually better. While many people put down less and do fine, the best strategy is to put down 20% or more if you can afford it. That will bring you lots of financial advantages to enjoy during your years of car ownership.

Vehicle purchase after repossession

Many customers do not know what to do for their next vehicle purchase after a repossession.  At John Amato Hyundai Superstore we specialize in establishing and re-establishing credit even after a vehicle repossession.

What is the Vehicle Repossession Process?

The vehicle repossession process is pretty straightforward.  First, you may receive a letter stating  your loan payment is past due.  This does not always happen.  If it is specified in  your loan contract, you will get a letter.  A few days after the letter is sent,  you will get a phone call from the loan company stating that the payment is late and what you plan to do to avoid repossession.  After a “grace period”  expires the loan company hires a repossession company and they take the vehicle.  You will then receive a letter telling you how much you owe for the loan payments and repo fees.

After Repossession

It may feel like the world stopped because your vehicle was repossessed.  But, in fact it was a vehicle that you could not afford.  It is however a large step back in your financial life, but it won’t stop you from moving forward.  Lenders have been loosing the reigns on the car loan requirements and are now willing to assist customer with problems in their credit.

A vehicle repo can greatly lower your credit score and move you down the standings in credit categories.  At John Amato Hyundai Superstore, we don’t turn away customers that have had issues in the past.  We are here to finance your future  not your past.   We work out a deal that fits you into a budget, but there are a few things that you can do to help

Determine Where your Credit Stands and Repair it

You know your credit score is going to go down because of the repossession.  But it may not be as bad as you think.

Auto loans can be a complicated process and getting approved should not be your only concern.  You want to get favorable terms on the loan as well so  you can afford your payment.  This is all determined by what your credit report says to the lender.  For example, your score is not the only factor

Other factors that impact your loan is:

  • Slow payments or late payments on loans
  • Defaults on loans
  • Repossession
  • Bankruptcy
  • Collection notices

Anyone with these on their credit report will be subject to higher interest rates because they pose a risk to the lender.  You must re-establish your standings for long term loan.  You need to repair your old debt for better future loans and debt.

If you are behind on payments on other loans, you need to bring those payments current.  This shows lenders that you are making an effort to make good with your creditors.  Remember, that rebuilding your credit is not an easy or quick process. It takes time, commitment and discipline to stay on top of your bills.  But, in the end it is worth it to receive better interest rates and terms in the future.


Be Prepared when you Visit John Amato Hyundai Superstore

Having a down-payment is generally a requirement of anyone with less than perfect credit looking to get an approval for an auto loan.  The bigger the down-payment the more options you may have.  Having a down-payment tells lenders that you have control over your finances, which in turn, means they are more favorable to approve your loan application


If you don’t have a down-payment, you can trade in your vehicle, whatever equity you have in your vehicle will be used as a down-payment.

After you have figured out your money situation, and schedule a time to come into John Amato Hyundai Superstore Milwaukee, you need to bring in the following items to turn into the lender

  • Valid Driver’s License
  • Current Proof of Income (pay stub)
  • Bill with your name and address on it (utility bill)

You should always bring in the documentation the same day of your visit, so it does not interrupt the loan application with the lenders.  It makes the process go by quicker and smoother and will allow the lender to see that you are organized and serious about making a purchase.

When you are speaking with the finance manager at John Amato Hyundai Superstore, keep in mind they are making sure that everything you say is accurate, so it is best to be completely honest.  Do not lie about past credit or income.  If that happens your loan application may be automatically declined.

Set your Goals Realistically.

You have already been down the road with a vehicle you could not afford the payments on , so do not do that again.  Instead come to terms that in fact the car  you can afford may not have navigation or leather or a sunroof.

Look at cars that fit into your budget and the parameters that the lender set up.  You need to show the banks that you can make on time payments, they are giving you a second chance.  Stick to a vehicle with what you need for now.  Make your payments on time and your  credit will improve, then the next vehicle will probably have all the options that you wanted.

As We See It

Repossession is not the end of the world, it is only a minor set back that you need to correct.  You do not have to give up all hope of ever owning a vehicle again, because we can help you.  We are a special financing dealership that has the tools and experience to get you into another vehicle.  Which in the end rebuilds your credit score.


Get started today by beginning your application at John Amato Hyundai Superstore Milwaukee

Car Loans after Bankruptcy

One of the first things we, John Amato Hyundai Superstore as a subprime specialist look at when you apply for a car loan after bankruptcy is to see whether you are discharged or dismissed from bankruptcy.    If you are discharged, you have a high chance of an auto loan approval with bad credit, because it shoes a successful completion.  A dismissed bankruptcy means that you did not complete the process per the court order and it could result in a rejected application.

When looking for a vehicle after bankruptcy, we suggest scheduling a time with one of our credit specialists.  This way they can walk you through your options that are available  Whether it is new or a preowned vehicle, our specialist will get you qualified the proper way for the lending institutions.  We make the process quick and simple


Benefits of After Bankruptcy Vehicle Financing

You have successfully completed your bankruptcy which makes you essentially debt-free, taking on a new debt can seem like a pretty scary idea.  The reality is that a post-bankruptcy car loan is in fact one of the fastest ways to rebuilding your credit score after discharge.

There are two main categories that the credit bureaus use to calculate your credit score: revolving credit, like a credit card or installment loan such as an auto loan.  The goal is to have at least one open account, and current without maxing out the available credit balance.  By financing a vehicle thru John Amato Hyundai Superstore, you can easily meet those goals with an open installment loan that has a balance with affordable monthly payments.  Each payment you make will be reported to all three credit bureaus and assist you to rebuild your credit fast.

Down Payments on Post Bankruptcy Car Loans

A down payment can be the make-or-break point in a car loan approval following a bankruptcy.  Lenders like to see that you are equally invested in the vehicle and willing to hold up your end of the deal and a down payment is your investment

Making an investment into the car is not just a benefit for the lender’s sake, but also your own.  By putting money down on a vehicle creates advantages you may not be thinking about long-term.  For instance with a down payment you will experience

  • Lower total amount owned on the loan
  • Lower monthly payments
  • Shorter loan terms

Hassle Free Car Financing for Bankruptcy Clients

Filing for bankruptcy is nothing to be ashamed or embarrassed of because you have giving yourself a clean slate to start over with.  John Amato Hyundai Superstore’s specialist in bad credit auto sales makes it easy for you to start rebuilding your credit quickly.   Our process is fast simple and secure.  Apply online   and schedule your appointment time to come in.

5 Fast Facts on the Hyundai Elantra

According to JD Power and associates, Hyundai adds a value trim level to the 2016 Hyundai Elantra, which is available as a 4 door sedan or a 5 door hatchback.  It also embellishes exterior front and rear styling on certain variants.  The auto maker also offers a choice of connected infotainment and safety systems

If you are researching compact cars, here are five fast facts about the 2016 Hyundai Elantra:

1) The Elantra’s new Value Edition bundles favorite features including 16-in. alloy wheels, power tilt sunroof, leather-covered tilt-and-telescoping steering wheel and shift knob, heated front seats, push-button start, chrome and aluminum accents, and side mirror turn signals.
2) Trim levels include SE, Value, Sport, and Limited in manual or automatic editions. Heated and cooled front seats are available on the Elantra GT and a 3-setting drive-mode selector is standard on SE, Limited, and GT trims. The Limited gets extra features such as push-button start, and the Sport comes with cloth seats. For 2016, the GT hatchback gets a new grille and front-end treatment and rides on 17-in. alloy wheels.
3) The Elantra SE and Limited are powered by a 1.8-liter 4-cylinder engine that makes 145 horsepower and 130 lb.-ft. of torque and is EPA-rated at 28 mpg in city driving and 38 mpg on the highway. The Elantra Sport comes with a 2.0-liter 4-cylinder engine that produces 173 horsepower and 154 lb.-ft. of torque. A 6-speed manual or automatic transmission is available.
4) The 2016 Elantra earned the top rating of 5 stars from the National Highway Traffic Safety Administration (NHTSA) and received a “Top Safety Pick” designation from the Insurance Institute for Highway Safety (IIHS).
5) Elantra’s interior volume—110.4 cu. ft.—outdoes many of its compact rivals; it even surpasses the interior space of the 2015 Nissan Maxima, a midsize car, according to Hyundai. At 14.8 cu. ft., the Elantra’s trunk space beats major compact competitors, Hyundai says.


With over 100 New Elantras in stock.  See John Amato Hyundai Superstore for your next vehicle.

Check out our Vehicle of the Week 2013 Escalade

John Amato Hyundai is proud to reveal its’ vehicle of the week

This beautiful 2013 Cadillac Escalade Luxury.

This AWD SUV has low miles equipped  with the following items:

  • Alloy Wheels
  • Sirius XM Radio
  • AM/FM Stereo with Navigation
  • Auto-leveling suspension
  • Automatic temperature Control
  • Front Dual zone AC
  • Front Fog lams
  • Fully automatic headlights
  • Heated Door Mirrors
  • Heated Front Memory seats
  • Navigation System
  • Pedal Memory
  • Power Driver seat
  • Power tilt sliding Sunroof with Express open/close
  • Rear AC
  • Rear Entertainment System
  • Remote Keyless
  • Security System

Amato Hyundai Superstore is honored to offer this great looking 2013 Cadillac Escalade.  This vehicle is the vehicle for your lifestyle.  Not only does your next SUV has to be your workhorse during the day but also have the safety and amenities to carry your family.  This Escalade has a Clean CARFAX


Already priced over $3000 Below Market this vehicle will not last long


Call John Amato Hyundai to schedule your test drive today.  414-586-3237

or visit us at


Common Questions about Hyundai CPO Program

John Amato Hyundai Superstore is the #1 Hyundai Certified Preowned Dealer in the State of Wisconsin.  Often when searching for a quality preowned vehicle, customers have several questions.  Here below are a few of the most common questions answered about the Hyundai Certified Preowned Program or (CPO)

What is Hyundai Certified PreOwned (CPO)?

Only Hyundai vehicles that meet our high program standards are eligible to become a Hyundai Certified PreOwned vehicle.  All Hyundai CPO vehicles must be current model year and up to four previous model years old, and have less than 60,000 miles on the odometer. All vehicles must pass a comprehensive 150–point quality assurance inspection and have a non-branded title as verified by a CARFAX® Vehicle History Report™.

What is a CARFAX® Vehicle History Report™ (VHR)? What disqualifying items eliminate a vehicle from earning Hyundai CPO status?

CARFAX® VHRs™ contains information that can impact a consumer’s purchase decision about a used vehicle by providing information such as major structural damage, total loss accident history, or title information. Hyundai’s CPO Program requires participating dealers to generate a CARFAX® VHR™ as a part of the certification process. Any vehicles with the following items are ineligible for inclusion as a Hyundai CPO vehicle.

Damage Brands Total Loss Verified Rollback OEM Buyback
Odometer Brands Structural Damage, Fire Damage, Airbag Deployment Auction Odometer Problem Auction Manufacture Buyback
Buyback Brands Major Damage Indicators, Scrapped, Recycled, etc. Potential Odometer Rollback Currently Stolen
Grey Market
Where can I purchase a Hyundai CPO Vehicle?

Hyundai CPO vehicles are sold exclusively through participating Hyundai dealers.  Simply hover your mouse over “Vehicle Search” on the menu bar and click “Locate a Dealer”. Type your zip code and locate the nearest selling dealer(s).

What warranty coverage is included with the purchase of a Hyundai CPO vehicle?

The Hyundai Certified Pre-Owned Powertrain Limited Warranty begins on the manufacturer’s original in-service date and odometer mile zero, and will be in effect from that date for a period of 10 years or 100, 000 miles – whichever comes first1. The warranty covers the repair or replacement of “Covered Components” which fail under normal use due to a defect in materials or workmanship2. Coverage is limited to those components and parts listed under the section “Covered Components” on the CPO Powertrain Limited Warranty Provisions form.

Find out more about the Hyundai CPO warranty on the “Certified Warranty” page under the “Learn About Certified” menu.

What types of service does Roadside Assistance include?

A 10-year / unlimited mileage roadside assistance plan is included with the purchase of a Hyundai CPO vehicle.  Roadside services include dead battery/jump start, flat tire change, lock-out service, gas delivery, and towing for any warrantable repair. Complimentary Roadside Assistance coverage is 24 hours-a-day, 7 days-a-week and 365 day-a-year and is available by calling 1-800-243-7766.

Is the Hyundai CPO warranty transferable?

Upon the sale of the vehicle (private party-to-private party), the CPO warranty is transferred and coverage is afforded to the new owner for the remainder of the 10-year / 100,000-mile CPO Powertrain Warranty term. The Hyundai Customer Connect Center at 1-800-633-5151 must be contracted to update Hyundai’s ownership records. Upon trade-in or sale of the CPO vehicle to a Hyundai dealer or any entity in the business of selling or leasing motor vehicles, CPO certification and Limited Warranty coverage ends.

Is SiriusXM® satellite radio included with the purchase of a Hyundai CPO vehicle?

Yes. Beginning September 12, 2014 Hyundai CPO customers receive 3-month of no-charge SiriusXM® “All Access” trial. This means Hyundai CPO customers can listen to all SiriusXM® premium programming including over 150 channels of satellite radio in their car as well as over 160 channels of SiriusXM® internet radio on a computer, smartphone or tablet for 90 days from the vehicle’s purchase date.  Customers purchasing a Certified Pre-Owned vehicle prior to September 12, 2014 receive 3-month SiriusXM® basic trial.

What other benefits are included with the purchase of a Hyundai CPO vehicle?

Travel Breakdown Protection will be provided for the duration of your Hyundai Certified Pre-Owned Powertrain Limited Warranty. In the event of a Mechanical Breakdown of a Covered Component, Hyundai will reimburse you for hotel lodging and restaurant expenses incurred, commencing the day after the claim is reported, providing you are in excess of 150 miles from home. Such expense shall be limited to $100 per calendar day and up-to $500 per occurrence.  You must receive prior authorization for travel expenses by calling 1-800-477-8089.

You will be allowed up to $35 per day for a maximum of ten (10) days for documented car rental expenses incurred if required due to a covered Mechanical Breakdown or manufacturer’s warranty repair.  You must receive prior authorization for rental expenses by calling 1-800-477-8089.  Rental reimbursement is limited to downtime warranty repairs and ends on the date of warranty repair completion.


Understanding Finance Terms

Before signing any documents, whether at a dealership or lending institution understanding the following  finance terms will only benefit you

Additional Product or Services – Products or services that the dealer may offer in a sale, financing or lease.  Examples include extended service contracts, credit insurance.  These products are sometimes optional.

Amount Financed – The dollar amount of the credit provided to you

Annual Percentage Rate (APR) – The cost of credit expressed at a yearly rate.  Factors that influence your APR:  Your credit history, current finance rates, market conditions and special offers are among the factors that affect your APR.

Assignee – The bank, finance company or credit union that buys the contract from the dealer

Credit Insurance – Optional insurance that pays the scheduled unpaid balance if you die or the scheduled monthly payments if you become disabled.  The cost of the optional credit insurance must be disclosed in writing.  If you decide you want it, you must agree to it and sign for it.

Credit Report – A document  that includes information on where you live, how you pay your bills, whether you have been sued, or have filed for bankruptcy.  Nationwide consumer reporting agencies sell the information in your report to creditor, insurers, and  other businesses that use it to evaluate your applications for credit, insurance, employment, or renting a home

Credit Score – A number that reflects the credit risk you present based on information in your credit file.  The better your history of credit, the higher your score.  Your credit score may be used to help decide the rate and other terms you are offered.

Down Payment – The initial amount you pay to reduce the amount you finance.

Extended Service Contract – Optional protection on specified mechanical and electrical components of the vehicle that may be available for purchase.  It supplements any warranty coverage provides with the vehicle.

Finance Charge – The cost of credit expressed as a dollar amount.

Guaranteed Auto Protection (GAP)– Optional protection that pays the difference between  the amount you owe on your vehicle and the amount you would get from your insurance company if the vehicle is stolen or destroyed before you have paid off your credit obligation.

Monthly Payment Amount – The dollar amount due each month of the loan, finance contract, or lease agreement

Negative Equity – The amount owed on a vehicle above its market value.  For example, if your credit pay off is $18000 and your vehicle’s market value is $15000, you have negative equity of $3000

Negotiated Price of the Vehicle – The purchase price of the vehicle agreed on by the buyer and the seller.  The price should reflect any rebates, discounts, or special offers that you get at the dealership of you meet certain qualifications, which would be clearly disclosed.

Repossession – If you do not make timely payments on you vehicle, your creditor (the bank) may have the right to repossess it without going to court or warning you.

Total of Payments – As disclosed on the loan or finance contract, the total amount you will have paid after you have made all the payments as scheduled.  For a lease, this is the amount you will have paid by the end of the lease.






Red Hot Dodge Charger R/T at John Amato Hyundai

John Amato Hyundai Superstore Milwaukee vehicle of the week is the 2014 Dodge Charger R/T

This vehicle is ready for the summer driving.  Clean Car Fax, Red, 18 x 7.5 Aluminum Wheels, Air conditioning, Sirius XM , Audio Jack, Automatic Temperature Control, Heated Seats front and Back and so much more.

Come down and take a look at this 2014 Dodge Charger RT at John Amato Hyundai Superstore at 8380 N 76th St Milwaukee.

Auto Financing 101- John Amato Hyundai Milwaukee

When choosing auto financing the cutomer may have two options : direct lending or dealership financing

Direct Lending may offer you 

  • Comparisons- You have the chance to shop around and ask lenders directly about their terms before you agree to purchase a specific vehicle
  • Credit terms in advance – By getting financing before you purchase a vehicle, you will know your rate and terms when you start your shopping

Dealership Financing 

In dealership offered financing, you get your financing through the dealership where you are purchasing your vehicle.  You and a dealer will enter into a contract where you buy a vehicle and agree to pay the amount financed and the finance charge.  The dealer may in return the contract to the bank , finance company or credit union, that services the account and collects your payments.

Dealership financing may offer you:

  • Convenience- Dealers offer vehicles and financing in one location, and often have extended hours including evenings and weekends
  • Multiple financing options – The dealer’s relationships with multiple banks and finance companies may mean it can offer you a range of financing choices
  • Special Programs – Dealers sometimes offer manufacturer-sponsored, low-rate or incentive programs to buyers.  The programs may be limited to certain vehicles or may have special requirements, like a larger down payment or shorter contract length.  These programs might be only certain credit rating statuses.

Before you Buy or Lease a Vehicle.

Determine How Much you Can Afford

Before you finance or lease a vehicle, take a look at your current financial situation to make sure you have enough income to cover your monthly living expenses.  Then, if you want to finance a vehicle, know the total amount you will pay.  This will depend on several factors, including the price you negotiate for the vehicle, the Annual Percentage Rate (APR), which may be negotiable, and the length of the credit contract.


Finance or lease a vehicle only when you are able to take on a new obligation.  Check the overall cost of the purchase of lease.  Consider the monthly payment in finance or lease negotiations.

The only time to consider taking on additional debt is when you are spending less than you take home.  The additional debt load should not cut into any amount you have committed to saving for emergencies and other top priorities.  Saving for a down payment or trading in a vehicle can reduce the amount you need to finance and reduce your financing costs.  In some cases, your trade in vehicle will take care of the down payment ton your new vehicle.

If you owe more on your vehicle then its market value, you have negative equity in your vehicle.  This is a consideration if you plan to use your vehicle as a trade in. The longer your new credit contract, the longer it will be before you have positive equity in the new vehicle – that is, before it is worth more than you owe.  If you have negative equity, you may need a bigger down payment to try and cover some of the inequity in you current vehicle and to get a qualification loan call from a lender.  If you take all of the negative equity into your new loan, your monthly payments will increase.   If you have negative equity, consider paying down the debt before you purchase another vehicle.

When You Apply For Financing 

Most dealerships have a Fiance and Insurance (F&I) Department that will explain to you your fiancneing options.  The F&I Deparment mangaer will ask you to complete a credit application that will include :

  • Name
  • Social Security Number
  • Date of Birth
  • Current place of residence and length of stay
  • Current and previous places of employment and length
  • Occupation
  • Sources of Income
  • Total Gross Monthly Income
  • Current Debt Obligations

Most dealerships will get a copy of your credit report, which has information about your current and past credit obligations,  your payment record, and data from public records.  For each account, you credit report shows your account number, the type and terms of the accounts and the credit limit.  This also includes Credit limits, most recent payments and balances owed.  This also includes creditors summary of past due information, legal steps and and any collection obligations

The dealership will submit your application of credit to one or more potential lending institutions.  They will determine their willingness to buy your contract

The finance company will evaluate your credit application using automatic techniques, like credit scoring, where the factors like your credit history, length of employment, income and expenses may be weighed and scored

The potential lender will not deal directly with the customer when you finance through a dealer.  It bases its evaluation on your credit report and credit score, the completed credit application, and the terms of the sale, including trade in or down payment.  The potential lender will decide whether it is willing to buy the contract, notifies the dealership of its decision along with their stipulations of the loan and guidelines

Your dealership may offer manufacture incentives, such as reduced finance rates or cash back on certain models.  The dealer will also check to see if you qualify for any additional rebates or cash back.  Generally these discounted rates are non negotiable, and it may be limited by the consumer’s credit history, and may be available only on certain makes and models

Dealers who promote rebates, discounts or special prices will show you if or how you qualify for the incentives or discounts.  For example, some offers may include recent college graduates, military members etc.  These are set by the manufacturer passed to the dealer and the consumer must meet the requirements to gain the extra rebate.