The best car loans for bad credit of June 2026

Bad credit can be a barrier to being approved for a car loan or for getting favorable terms. Fortunately, even if your credit history has some blemishes, you still have options from banks, credit unions, fintechs and other institutions.

CNBC Select compared more than 20 lenders to pick the best for auto financing with weak credit, based on credit requirements, affordability, types of loans offered, customer service and other factors. (Read our methodology to find out how we made our picks.)

Who's this for? In addition to having no minimum credit score requirement, Carvana streamlines car shopping, financing and delivery into one seamless process. Get your vehicle from one of its car vending machines or have it delivered directly to your driveway.

Standout benefits: Carvana has a seven-day return policy. Applicants can get prequalified in two minutes with no harm to their credit score.

Who's this for? One way to get approved for financing with bad credit is applying with a creditworthy co-signer. Unlike some lenders, Capital One Auto Finance allows you to add a co-signer or co-applicant to get approved and get more favorable terms.

Standout benefits: Capital One's Auto Navigator tool allows you to prequalify for multiple offers at once with no impact on your credit score.

Who's this for? If you're shopping for a used car, CarMax Auto Finance has a huge inventory of pre-owned vehicles. It offers both in-house financing and loans from partners like Ally Auto, Capital One and Santander, that offer competitive rates and no minimum credit score requirement.

Standout benefits: CarMax's 3-Day Payoff Program allows customers to replace their CarMax financing with a better APR from another lender for free within three business days of the purchase.

Who's this for? Looking to refinance? Online loan aggregator Autopay stands out for its abundance of refinancing options, including traditional and cash-back financing, as well as lease-buyout financing.

Standout benefits: Funding can be available as soon as the same day. Borrowers can get preapproval for offers from banks, credit unions and online lenders without damaging their credit. Autopay also offers gap insurance and service contracts.

Who's this for? Westlake Financial has an array of financing options for borrowers of every credit score (or no credit), including options with rates as low as 4.99%, terms up to 72 months and down payments as low as $0.

Standout benefits: Westlake works with a network of over 50,000 car dealerships. Its eContracting service streamlines paperwork and allows for funding up to a full day sooner.

Who's this for? If you're looking to refinance, iLending has term lengths as long as 96 months. Most lenders cap out at 72 months.

Standout benefits: To get matched with one of its lenders, iLending only requires an income of $1,500 per month, a 560 credit score and a credit history of just six months with at least one account on it.

A bad credit car loan, also known as a subprime or second-chance loan, is auto financing for a borrower with a low credit score or thin credit history.

While the exact score varies by lenders, most find scores above 670 as indicating good creditworthiness. Someone with a FICO score of 580 or less is generally considered a high-risk applicant.

You may still get approved for financing, but you'll likely be offered a higher interest rate and less favorable terms.

That said, lenders look at other factors, too, such as your income and other debts you have. The more indicators they find that you're likely to pay back the loan on time and in full, the better your chances of getting approved.

There are several ways you can improve the odds of approval:

• Improve your credit score: With a lower credit score you'll not only have a harder time finding a loan, but you'll also get worse terms. Review your credit report for errors and focus on making on-time credit card payments to help raise your credit score.
• Get a co-signer: Asking someone to co-sign your loan with you will improve your approval chances, but should be thoroughly discussed first.
• Increase your down payment: While not always possible, paying more upfront can decrease your payments and how long it takes to pay off your loan which will improve your approval odds.

Several factors determine the interest rate you receive on an auto loan, but knowing them can help you pinpoint what you can improve before you submit an application.

• Credit score: Your credit score tells lenders how creditworthy you are (how likely you are to repay the loan in full). A higher credit score means you may qualify for some of the lower interest rates and a lower credit score means you can get hit with some of the higher interest rates (which costs you more money).
• Loan-to-value (LTV) ratio: This refers to how much of a down payment you plan to make on the vehicle compared to the loan amount you're borrowing. A higher LTV ratio means that you'll have significantly more debt than equity in the vehicle — and this can mean you're on the hook for higher interest rates.
• Debt-to-income ratio (DTI): This is the amount of debt you have in relation to your income. A lower DTI can get you lower rates while a higher DTI can mean higher interest rates.
• Vehicle age: Older cars are seen as riskier for lenders because of wear and tear and a greater chance of needing expensive repairs. Because of this, you may be subject to higher interest rates if you purchase an older car.

Before taking on an auto loan, it's important to estimate your monthly payments. CNBC Make It offers a handy loan calculator that can help you see how much you will pay monthly, how long it will take to pay off the debt and how much you'll pay in interest.

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every car loan list is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of loan products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See our methodology for more information on how we choose the best car loans for bad credit

To determine which auto loans are the best for consumers with bad credit, CNBC Select analyzed more than a dozen car loan providers, including banks, dealerships and online marketplaces.

When narrowing down and ranking the best car loans, we focused on the following features:

Credit requirements: Each lender approves financing for applicants with a FICO score of 580 or below and offers the option to add a co-signer or co-borrower.

Loan sizes: Lenders on our list provide loans in a range of sizes, from $500 to $100,000, and advertises its respective payment limits and loan sizes.

Loan terms: Each lender provides more than one financing option that you can customize based on your monthly budget and how long you need to pay back your loan.

Application process: We considered whether lenders offered same-day approval and a fast online application process. Each lender on our list offers prequalification without triggering a hard inquiry and damaging your credit score.

Fees: Lenders that do not charge an origination fee or prepayment penalties were given more weight.

User experience: We considered whether a lender provides rates, terms and other information on its website and if it has a mobile app and an online chat feature. We also considered the availability of customer service representatives.

We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.

Based on those criteria, our choices for the best car loans for bad credit are:

• Best for convenience: Carvana
• Best for borrowers with a co-signer: Capital One Auto Finance
• Best for used cars: CarMax Auto Finance
• Best for refinancing: Autopay
• Best for low or no down payment: Westlake Financial
• Best for long repayment terms: iLending

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