no credit, bad credit bankruptcy cars
September 29, 2019 1:50 AM   Subscribe

my credit is crap. help me buy a car.

my credit has been in the toilet for years. i'm about to declare bankruptcy. and my car was totaled last week, one day before i re-upped my insurance.

i'm probably going to have to buy one of those no credit dealerships (i don't have enough cash to go to a "real" one) - and i'm okay with that. but i haven't ever bought a car by myself - what questions do i need to ask?
posted by megan_magnolia to Work & Money (11 answers total)
If I understand correctly, you don't have a meaningful lump of cash to use as a down payment, in part because you were driving uninsured when your car was totaled. That you were driving uninsured suggests you're having a hard time affording insurance, let alone a car payment. I guess the first questions should be, what can you actually afford to spend without making your finances worse than they are now, and then is that amount enough to buy a car worth having? Do you live in an area / have a job where it would be feasible to go without a car for a while?
posted by jon1270 at 4:00 AM on September 29, 2019 [5 favorites]

If you have a bank or credit union where you have accounts, go to them and ask what kind of loan they could make you. Find out if you can get an advance on your paycheck or a loan from a friend/family member to get yourself a $1000 beater off craigslist. Really really avoid the “no-credit” car places, they are predators.

(If you do have room to consider a non-car alternative, a motor scooter might be a good option - in most US states you can drive one without a motorcycle license and you don’t need to insure, and registration, gas, etc. are cheap. Probably not an option, though, if you have to make a lot of highway trips or trips over ~10 miles. You can get one for under $1000.)
posted by mskyle at 5:37 AM on September 29, 2019 [3 favorites]

Look for a reliable model. I have had excellent luck with Toyita, Honda, Nissan. Ask about any warranty and get out in writing. Drive a lot of cars. When you find a car you're serious about, take it to a mechanic and get an inspection. Carfax keeps records of some car accidents, so check the carfax record. At a dealer, offer at least 10% less than asking. Take at least a day to think it over, pressure makes for bad decisions. I just bought a car from a small used car dealer, they were regular, reasonably honest people, so look at a few dealers. Buying from an individual is a lot cheaper, so all among people you know, maybe somebody has a beater for cheap. If anyone will cosign a loan for you, that would be a big help, but you have to be sure thou don't burn family and friends.

It sound like life is difficult and out of control right now, I hope it gets better.
posted by theora55 at 6:26 AM on September 29, 2019

You can get a cheap car off Craigslist. Get a Toyota or Honda (cheap to fix). Pay cash. Make sure you can afford insurance. The insurance part isn't optional- it's part of the price of the car. I bought a 12 yr old Corolla with a smashed in side door for under 2k and it will likely last for at least 10 more years. You could get one is worse shape to last a year or so (for cheaper) until you can save up for a better one.

Based on the context of your question it sounds like you need to invest time in becoming financially literate. If you buy a car on any sort of credit you are just digging deeper into a financial disaster. Being financially secure takes a lot of hard work and sacrifice, there isn't a quick fix. I hope you figure it out, but you can't do it heading down the same path that's lead you here.
posted by KMoney at 6:57 AM on September 29, 2019 [2 favorites]

Some car dealers who work with bad credit buyers are better than others. I bought cars three times in two different states from JD Byrider, and did not get ripped off. The cars were fairly decent and outlasted the payments by a bit, as I recall, and they were easy to work with. The last time I went there to get a car the manager ran our credit and told us our credit was actually good enough to buy from a regular car dealer, and recommended we do so. I was really impressed by that.

Of course, there was another "buy here pay here" place we tried once that aggressively tried to sell us an overpriced, obviously crap car and when we declined he shrugged and said "some Spanish will buy it" (at which point we bolted for the door!)

The point being, if you have to use "buy here pay here" just be careful who you go to.
posted by Serene Empress Dork at 7:01 AM on September 29, 2019 [1 favorite]

Don't get a loan from a friend just before declaring bankruptcy. Banks and other financial institutions price the risk of bankruptcy and the resulting reduction of value of the loan into the loan. A friend, you'll just be screwing.

I'm sorry things have been so tough. I hope the bankruptcy gives you a chance at a fresh start. Please read this and watch out for the pitfalls described.
posted by praemunire at 7:40 AM on September 29, 2019 [2 favorites]

Save to pay cash from Craigslist, as above. Do not buy a car on credit from a vulture dealer.
posted by killdevil at 8:55 AM on September 29, 2019 [4 favorites]

This may be more than you're looking for, but Dave Ramsey has a good overall program for getting out of debt and managing your money. He has good advice about car buying, too. He has a radio program, but you can also access his organization here:
posted by summerstorm at 9:20 AM on September 29, 2019 [1 favorite]

I'd like to gently suggest that OP knows that their financial situation is shaky and doesn't need everyone lecturing them about that. OP asked for help buying a car.

OP, I asked a similar question back in 2012 that might help you (you'll see that I also got lectured about my finances). What ended up working for me was to ask everyone I knew if they knew anyone looking to sell their car. I got lucky and a co-worker/friend was looking to get rid of an older car.

I'm not sure where you are or what the Craigslist scene is there, but in my experience (7 years ago in Phoenix...) there were not any decent cars on Craigslist for $1000. There were not any decent cars on Craigslist for $2500 (which is what I had to spend). And my definition of "decent" was basically that it runs, stops, and doesn't fall apart when I'm driving it. But maybe you'll have better luck there. If you do go the Craigslist route, make sure you take the car to be checked out by a mechanic first (most will do a pre-sale inspection for around $50; if you have an existing relationship with a mechanic, they might even do it for free).
posted by Weeping_angel at 10:32 AM on September 29, 2019 [6 favorites]

Let your friends, co-workers, etc. know you need some cheap wheels. Someone might have an old car they don't really use but can't be bothered to put on Craigslist because of the hassles and scammers. They might sell it cheap (or free!) just to get rid of it.
posted by leaper at 2:02 PM on September 29, 2019 [3 favorites]

What you need right now is a 2000Ish Toyota Corolla. They're not great cars. They're not safe cars. But they laugh at abuse, last forever, and you can find one with 150-180,000 miles for cheap.
posted by wotsac at 6:56 PM on September 29, 2019

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