Direct vs Indirect Bad Credit Auto Financing

There are many different ways to get auto financing with bad credit through direct and indirect car loan methods. Many people fail to see that there is a big difference between the two types of lending, and depending on how poor your credit is you may prefer to choose one method over the other.

Direct Auto Financing

A direct auto loan is a type of lending that a car financing company in which a lender conducts the loan process. This means that there is no need for a bank, credit union, or other outside lender to get involved with funding you. Generally, these are buy here pay here dealers, your job is your credit lenders, and in house auto dealerships commonly offer these loans.

Indirect Auto Financing 

An indirect car loan is the typical type of financing people receive when they buy a car. These are financial opportunities that are always found with bad credit auto financing from normal lenders like AutoNet Financial. This means that you receive financial assistance from either a bank, credit union,
or outside finance company.

Which Lending is Best for Poor Credit?

Looking at these two types of loans it may seem difficult to determine on which method to go forward with when you have poor credit. However, the decision to go forward with direct auto financing should be a car loan for very bad credit people as these types of lenders rarely conduct credit checks. This will make it much easier to make sure your credit doesn't keep you from buying a car, while also helping you reestablishing your credit.

A person can still apply for indirect financing and utilize banks and dealers for subprime lending, even with low credit. It is just important to make sure that your entire application contains all the proper information and meets the lenders set requirements.