Ever wondered if you can take out a no money down auto loan in Boston? Wonder no more. In Beantown, you can. If you are interested to get auto financing here but doesn’t have a hefty sum for down payment, read on below to find out what you will need to secure that loan.
When it comes to no money down auto loans, good credit is a requirement of almost all lenders. Banks, credit unions and auto dealers alike let car buyers with good credit purchase their vehicles of choice without the need for a down payment. They do this through special programs. In order to qualify for no money down car loans, the buyer’s FICO score must be 700 or above.
The aforementioned lenders allow those with good credit to borrow even without a deposit because they are not high credit risks. As their scores suggest, these people are creditworthy and less likely to default. Hence, the creditors need not worry too much about repayment.
If good credit is a requirement for no money down auto loans, does it mean that those with bad credit can’t apply for them? No. If you have bad credit, you can still buy a car through financing even without a down payment. However, finding a lender that will allow you to make the purchase without a deposit will be challenging. If you do succeed in finding a lender that will let you take out a no money down auto loan, brace yourself for a much higher interest rate. You will also be required a co-signer.
Trading in your current car will make you one step closer to that auto loan you want. Lenders are more likely to approve your no money down loan request if you offer a trade-in. Why? The trade-in already serves as a form of payment. You may not have enough cash for down payment, but you have a car that the dealer can keep and make a profit from.
Of course, no auto loan application will be complete without the paperwork. The documentary requirements remain the same. These include proof of identity (ID photo, signature verification proof, etc.), proof of residence (utility bill, bank statements, etc.) and proof of income (pay stubs for employed; tax returns for self-employed).
You also need to obtain important details about the vehicle, such as the VIN (vehicle identification number); the year, make and model; as well as its purchase price (indicated on a dealer sheet or buyer’s agreement). In order to bring the vehicle home, you will also need auto insurance.
To successfully get a no money down auto loan, you will need to pay a good price for the vehicle you have chosen. What is considered a good price is an amount equal to or below the Kelley Blue Book value? If the purchase price is hefty, you can get a no money down auto loan from the dealership that set the price, but not from banks and other financial institutions.