Financial advisors always emphasize good credit scores because it is the only way to secure a loan, including an auto loan. But sometimes, people with already poor credit scores may need to take out auto loans urgently and might find it difficult to improve their scores immediately. But the good news is that with certain strategies in place, it is possible to have one’s auto loan approved even with a low credit score.

Here are a few ways to get auto loan approval with a low credit score:

1. Get a person to co-sign the loan

When a person co-signs an auto loan, they promise to repay it if the borrower cannot. If the co-signer has a good credit score, there are good chances of lenders approving the auto loan request.

2. Provide proof of being capable of repaying the auto loan
If a person has had a recent salary hike or promotion, they may be in a better position to repay their loans than before. Similarly, any additional sources of income that have emerged recently can also help the borrower repay an auto loan more comfortably. So, in such situations, borrowers should inform lenders about any increase in their income levels or supplementary sources of income so that lenders become more confident about the borrower’s ability to repay the auto loan.

3. Try to improve one’s credit score within a few months
If one can afford to wait a few months before applying for an auto loan, they should actively take steps to improve their credit scores. For example, one can avoid delaying credit card payments or improving credit utilization scores. Although one’s credit score may not be boosted considerably, even a small jump can increase one’s chances of getting an auto loan approved.

4. Look for a co-borrower
A co-borrower with a good credit score can also increase the probability of one’s auto loan getting passed. However, one should be careful who one picks as a co-borrower because the co-borrower’s credit score greatly affects the lender’s decision. If the co-borrower also has a poor credit score, one’s chances of auto loan approval may be reduced. On the bright side, if the co-borrower’s credit report is satisfactory, it may also reflect positively on the primary borrower. Also, one should remember that the co-borrower’s credit score is also affected if the borrowers cannot repay the auto loan on time. So, one should discuss a systematic strategy to repay the auto loan within the given timeframe with the co-borrower beforehand.

5. Check if the credit report has any errors
Credit reports may sometimes have errors, which may cause one’s overall credit score to dip. So, a wrongly credited loan or an incorrectly outstanding credit balance can be a huge blow to one’s credit score. That’s why, before applying for an auto loan, one should check one’s credit report thoroughly for errors.

6. Avoid borrowing an unreasonably large amount
If one borrows a considerable amount with a low credit score, it is unlikely that their auto loan will get approved. While cars and other vehicles are usually expensive, borrowing only over and above what one can already afford is best. It is a good idea to check one’s savings and try to make a down payment first before borrowing the rest of the amount.

7. Be mentally prepared for a hard credit check
A hard credit check or hard pull is when a lender demands an extensive review of one’s credit report before approving an auto loan. This request gets recorded on the credit report; multiple credit checks can significantly affect one’s credit score. For this reason, it is best to go through multiple hard credit checks within 45 days if necessary.

8. Compare different borrowers’ minimum credit requirements
Credit requirements may differ among lenders, so one should compare the minimum credit requirements of different lenders before zeroing in on one. Some lenders may have a minimum credit requirement that is not much higher than one’s credit score, so there are better chances of one’s auto loan being approved by these lenders.

9. Borrow with collateral
Loan approval usually becomes easier if a borrower adds collateral, such as another vehicle or a bank account. If the borrower cannot repay the auto loan on time, the lender confiscates this collateral. However, the borrower should be ready to lose the collateral if they cannot repay the auto loan.

10. Apply for a loan against property
Loan approval usually becomes easier if a borrower adds collateral, such as another vehicle or a bank account. If the borrower cannot repay the auto loan on time, the lender confiscates this collateral. However, the borrower should be ready to lose the collateral if they cannot repay the auto loan.

11. Take a gold loan
Borrowing against gold is a good idea if one has gold as savings. So, if the borrower cannot repay the amount, the gold may be confiscated by the borrower. Since gold loans are usually quite flexible, they can be a good option for those with poor credit scores.