Can I Buy a Car with a Zero Down Car Loan?

Posted by on September 16, 2019 @00:05:21 EDT
Man driving his zero down car from

If you are looking for a bad credit car loan with no money down, it can be challenging to find the right financing. Applying to banks for a car loan again and again only to be rejected every time can be extremely discouraging. Fortunately for you, offers zero down car loans for over 7,000 new and certified used vehicles in our curated selection.

How Even a Small down Payment Can Help

Basically, the reason most lenders require you to make a down payment on your car is that they want to protect themselves in the instance that you won’t be able to pay them back. Even the smallest of down payments can help reduce your monthly loan repayment installments. While 20 percent is generally what is recommended, the average amount someone puts down is 12 percent. However, you can put down even less if you should choose.

So while a down payment might be able to help you lower how much you owe each month, not everyone can afford to pay that initial upfront lump sum. Luckily, there are alternative auto loan solutions available and is one of them.

Close up of cash for a car down payment

0 Down Payment Car Options

Increase Your Credit

Your first option for a zero down car loan is if you have good credit. Lenders will be more willing to approve your car loan application if you have a good credit history or a higher score. Generally, a credit score of 680 or higher will provide you with the best chance of waving a down payment without raising interest.

If you have a score below 680, you could try and increase your credit standing. There are various things you can do to make this happen. Pay your bills on time, keep your credit card balances low, and pay off any outstanding debts you may have incurred.

Find a Cosigner

Your second option to find a cosigner. If a family member or friend who has a strong credit score cosigns your bad credit car loan, they will share the responsibility of payment and ownership of your vehicle, which can help you get approved at a somewhat lower interest rate.

Be wary though. If you miss a payment, not only will your credit score be affected, but so with your cosigner’s.

Look Around

Finally, your third option to find a 0 down payment car loan is to go shopping! Look around at the different lender types available to you and negotiate the best deal you can. Consider looking outside of a traditional banking institution and go to an auto dealership, local credit union, or alternative loan provider. For example, offers zero down car loans as well as bad credit car loans so you don’t have to worry about your credit standing getting in the way.

Close up of a man signing a bad credit car loan

How to Qualify for a 0 Down Payment Car Loan

Zero down car loans are a higher financial risk for any lender than other kinds of loans. The level of risk needs to be assessed before granting approval. There are two main factors lenders look at when you apply for a 0 down payment car loan; your income and your credit history.

The reason why your income is taken into consideration is that lenders want some kind of guarantee that you have the ability to repay your loan. If you have a steady fixed income, you will be able to fit a loan repayment more easily into your monthly budget. Consumer Reports recommended guidelines suggest that your monthly car payments should be 10 percent of your monthly income. This means that you generally will not have as difficult a time getting a zero down car loan and are more likely to qualify.

However, it is still possible to get a 0 down payment car loan with a low credit score or even a bad credit history. The trade-off is that you likely have to agree to a slightly higher interest rate.

Affording a 0 Down Payment Car Loan

As previously mentioned, the most common reason you might be interested in a zero down car loan is for financial reasons. Sometimes the moment you need a new car is when you can least afford one. Which is why the affordability factor is a crucial component of your vehicle purchase.

Affordability goes beyond whether or not monthly loan repayments can fit into your budget. It also relates to the value of the vehicle that you are choosing. If your vehicle of choice is a fair price and will hold onto its value relatively well over time, you will more likely be approved as well.

For a 0 down payment car loan with bad credit, you will have to select a vehicle that is deemed affordable by the lender. Other factors to take into consideration also include the year and the mileage of the vehicle. This will affect the term offered to you. A lender who has a thorough understanding of zero down car loans will be able to determine if the car is of value and if it works into your monthly budget.

Man driving his zero down car from

Why Choose

Traditional financial lenders like banks will typically only approve 0 down payment car loans if the applicant’s credit is in good standing and they have a steady means of income. However, not every hard-working individual in Ontario

At, we offer zero down car loans for both new and certified used cars, regardless of what your current credit situation. Our team will work hard to get you estimates from some of Canada’s leading banks for car loan interest rates without a down payment.

We specialize in the following:

If you are interested in a 0 down payment car loan with, contact us today!