Auto Loans in South Bend (IN)

Every day, we help people in South Bend get approved for car loans, even if they are confronted with common challenges:

  • Low Credit Scores
  • No Credit
  • Zero Trade Equity or Cash

We’ve spent years securing a network of dealers and lenders across the state of Indiana, which means we can help applicants of all credit tiers and income brackets. You’ll be walked step-by-step through the process by a lending professional in your area.

The Decision: New or Used Car in South Bend

Many people decide to buy a new car as opposed to a used one because there’s little risk of winding up with a junker.

However, if you finance a new car, you should not be planning selling it off before the loan has been repaid, so you don’t find yourself owing the bank the loan balance remaining after the vehicle has been traded in or sold. That said, banks and finance companies view new cars as a lower risk option, which means it could be simpler to get a new auto loan if you have less-than-perfect credit.

Used Vehicle Financing in South Bend

A preowned car is a good option for the prudent shopper.

The shorter lending terms typical of used car financing typically mean less interest charged, even when you have a more significant interest rate. Remember, though, that there are limits on the condition of the vehicle. These vary from lender to lender, but typical requirements are as follows:

  • Miles: maximum of 70,000 to 100,000 miles.
  • Year of Production: maximum of 7 years old.
  • Non-commercial vehicles only.

Below, we’ve compared new and used auto loans in South Bend, Indiana. These numbers rely on these assumptions:

  • New car costs $19,050.
  • Used vehicle is two years old.
  • Prime credit score.
  • 20% down payment for new car, 10% for used.
  • Simple Interest.
New Car Used Car
Price $19,050 $9,525
Down Payment $3,810 $953
APR 5.00% 7.50%
Length 60 months 48 months
Monthly Payment $287.60 $207.27
Finance Fees $2,016 $1,377
Total Paid $21,066 $10,902

Bad Credit South Bend Car Loans

There are all sorts of complications that result in a bad credit score: unpaid bills, foreclosure, bankruptcy, and more. You don’t want to deal with a credit denial. Consequently, you should look for a dealer or lender in South Bend that helps people with non-prime credit. It’s likely that we can find you a lender or dealer in our network who wants to approve your loan.

A large percentage of your credit score is based on your payment history. That means a car loan, being a major loan, can help you boost your credit. In fact, after 12 months or so of timely payments you might be eligible to refinance at a lesser APR. You don’t want to strain your finances with an expensive car payment. Typically 5-8% of your monthly income is healthy, or $95 to $152 if you make $1,905, the average in South Bend.

Auto Loans for Students of Notre Dame

To be frank, it’s not easy to get a car loan while you’re in college. Since you’re probably not old enough to have established much in the way of a credit history, many lenders will treat you like a second-class citizen. Secondly, income is an issue. Lenders want to see that you will be able to make your payments, and their minimum income requirements are typically $375 a week. What’s more, you must be able to replicate this income through pay stubs or tax returns–not so easy to do, if a lot of it was cash or tip income. Still, we welcome students of Notre Dame (and other area colleges) to apply. If you have sufficient income and/or a cosigner, we have a good chance of getting you approved.

South Bend Buy Here Pay Here Dealerships

For those who have substantial credit problems on account of issues like bankruptcy or debt settlement, buy here pay here financing might possibly seem like a smart move. Sure, they rarely carry out credit assessments, so bad credit ought not be a hurdle, but it’s quite possible you’ll be charged excessively for this opportunity. In most cases, used vehicles are the only thing offered, and you may be asked to pay weekly, in cash. The numbers of vehicles being repossessed are astronomical, and so are the interest rates. That isn’t all: these dealerships rarely work with the credit reporting agencies, so you could make every single payment month after month with no boost to your FICO score.

South Bend Consumer Profile

  • Income Per Year: $22,860
  • Income Per Month: $22,860
  • Ideal Car Payment: $152 (8% of monthly income)

How Much Car Can You Afford at $152 a Month?

In summary, an appropriate auto loan is as follows: down payment of 20%, car payment of 5-8% of monthly income, and term length of 60 months or less. Given an income of $1,905 monthly, let’s take a look at what price car you could buy based on your credit.

Great Credit Fair Credit Subprime Credit
Monthly Payment $152 $152 $152
Loan Rate 3.30% 6.50% 10.50%
Months 60 60 60
Sticker Price $10,524 $9,736 $8,863
Down Payment $2,105 $1,947 $1,773
Interest Paid $725 $1,355 $2,054
Price with Interest $11,249 $11,091 $10,917