Can I Get A Car Loan Without A Credit Check?

Can I Get A Car Loan Without A Credit Check?

Have you always wanted to buy a car but held back because you have no credit history or have a bad credit score? Are you intimidated by banks and worried that you would get rejected as soon as you sent an application? If you answered yes to these questions and wonder whether you can get a no credit car loans free of a credit check, you’re in luck because the answer is yes. 


In this article, we’ll talk about no credit car loans, how they work, and the several options you can consider when you want to apply for a loan without a credit check. Let’s get started. 


What Are No Credit Car Loans?


As the name implies, no credit car loans do not solely rely on your credit score as most banks do. From the outset, getting a no credit car loan may cost more. This makes total sense because they are extended to borrowers who would otherwise be refused by popular banks and lenders because of having bad credit or no credit at all. To find the best rates and value for money, shop around car dealerships and lenders that offer this type of loan. 


What Are the Benefits of No Credit Car Loans?


The biggest benefit of no credit car loans is that they give people with no credit a chance to buy their own car. In essence, they also provide them with the opportunity to start and establish their own credit history and qualify more easily for loans in the future.


If you do not have available cash to secure a downpayment, a no credit car loan is also the solution as long as you can prove that you have sufficient means to pay for the loan. 


Are you in a hurry? Do you need to buy your car as soon as possible out of necessity? No credit car loans are known for having one of the quickest turnaround times in the market. There are providers that offer pre-approved applications or approval within 24 hours.



What Are the Risks of a No Credit Car Loan?


Most people worry about the supposed higher rates involved in getting no credit car loans. But we say you should be wary of spammy advertorials online or malicious companies offering no credit car loans. If the lender or car dealership asks you for a lending fee or pre-approval fee, there’s a huge possibility that it is not legit. 


We highly recommend doing your due diligence by researching for the background of your no credit car loan provider and their ratings on the Better Business Bureau. is a reputable company and offers no credit car loans in Ontario.


Are There Other Ways That Can Help You Get a Car Loan Without Credit?


As any financial expert would tell you, getting approved for a car loan without a credit check may be difficult but it is not impossible at all. In this section, we have rounded up several strategies that can work for your advantage. 



Have a Cosigner to Back You Up


Upon learning that you have no credit, the majority of car dealerships and lenders that you will encounter will either decline your loan application immediately or readily suggest getting a person with an excellent credit score and credit history as a cosigner for your loan. 


The cosigner will give your application a boost; basically, letting you borrow the money you need using his own credit data. The only downside of this scheme is on the part of the cosigner. More than vouching for your credibility and capacity in paying your own debts, the cosigner is automatically considered as a co-borrower and will, therefore:


    • Be legally obligated to pay the full loan: The cosigner will be responsible for shouldering your entire no credit car loan should you suddenly decide to turn your back on them.


  • Negatively impact financial standing/credit score for any of your late or missed payments: Any kind of irresponsible action on your side will reflect negatively in your cosigner’s permanent credit history and can potentially drag his/her overall credit score down. This means that their own credit card lines could be terminated and that they could be rejected by banks and lenders when it’s their turn to apply for a personal loan, car loan, or home loan.



While getting a cosigner could be one of the easiest ways to get approved for no credit car loan, you run the risk of ruining the trust and not to mention the financial health and future of someone important, who could be a close friend or a family member. 



Show Proof of Your Financial Stability


Build a great impression of yourself to lenders by showing them that you are a financially capable adult who has adequate resources to settle payments regularly. Without a credit score, many lenders would evaluate a loan applicant’s capacity by checking out the following:


  • Average monthly income
    Apart from the monthly salary that you regularly receive from your employer, include disability, legal settlement distributions, child support, and other regular cash installments can also be considered as forms of income. Logically, the more money you make, the better.

    But as tempting as it may seem to lie about how much you make in your no credit car loan application, we strongly advise against this. Most banks and lenders are critical against fraudulent applications and scrutinize every document presented as proof of income, including pay stubs or bank statements. They also conduct stringent background checks to verify if everything you stated in your loan application, including your salary, is true and correct.
  • Employment history
    Depending on how your lender processes a no credit car loan, you may be required to provide your employment history information anywhere from the past six months up to two or three years. They may ask for the contact details of your supervisor or manager, which they may use as a character reference to ask about your trustworthiness and to cross-check the income information you stated in your application. 

Generally, if they see that you have been with your current employer for a long time, you will have better chances than, say, someone who has only been with the company for a month or two. This is because it leaves a positive impression that you have a stable source of income that can sustain your car loan payments.


If you own a property or other valuable assets, bringing your proof of ownership may also work wonders for your application. They can be considered as collateral or seen as having enough resources to settle your loan. 


Bulk up Your Savings for a Down Payment


Securing a bigger down payment will always work for your advantage at any given scenario. Because it reduces your supposed loan amount, it makes things less complicated for you and makes the possibility of getting an approval for your loan incredibly high. Moreover, having a  downpayment ready is a solid statement about your financial standing even without credit and that you are serious about acquiring a big-ticket item.


Collate All Documentation About Your Credit Information


Even if you do not have an established credit card or mortgage payment history, you can direct your lender into checking out your alternative credit data instead. These can include:


  • Previous loan documents for other items
  • Monthly utility bills ( phone, energy, or water)
  • A copy of your bank statement
  • Proof of income and/or certificate of employment


Borrow From Your Retirement Fund


If you have been religiously saving a part of your monthly income for your dream retirement, you can borrow from it to purchase a new car. While this is not the most pleasant solution, it is, in fact, an option. If you can commit to paying the full amount that you borrowed back, in essence, there would be no harm down. Nevertheless, you should be careful and watch out for accompanying fees and penalties that may sound unreasonable. 



Tips to Start Building Your Credit or to Improve Bad Credit


Having no credit history is tons better than being tagged with bad credit because all you have to do is to begin and continue maintaining a good credit score.


If You Don’t Own a Credit Card…


You can apply for a secured credit card, retail store credit cards, a co signed credit card, or ask to be a supplementary or authorized user on somebody else’s credit card, which could be your parents or spouse.

Getting a credit card is one of the easiest ways to create your credit history from scratch. A secured credit card can give you 200 points instantly. A starter credit card, on the other hand, may have a lower credit limit, higher interest rate, and an annual fee.

You want to associate your name to an account with an outstanding credit score, not notorious for late payments, and with no record of unpaid debt that could be linked to your own credit score. 


If You Want to Establish a Good Credit Score Without a Credit Card…


This is doable but possible. As building a credit score requires that you borrow money in a way, you can do this by applying for a secured loan, credit builder loan, or a cosigned loan. All these loans are specifically designed to help people jumpstart their credit history. The trick is to borrow only an amount that you can confidently pay on time.


Always Make Your Payments on Time


Whether it is for your utilities, insurance, or mortgage avoid missing or making late payments.  A good credit score accounts for punctual payments.


Main Takeaways


Whether a no credit car loan or any of the several options we listed above is the right one for you is for you to find out.  We say, you’ll never know if you made a good choice or have missed out on a far better deal unless you have diligently weighed in on all the options within your reach. You will be surprised at how flexible things have become over the years. From no credit car loans, bad credit car loans, personal loan for a car, car loans for students, or from dealerships, community banks,  and credit unions.


While some could involve a catch, say, steep rates or unfavourable terms, the secret lies in knowing the options you have and shopping around for the most promising deals that match your current requirements and situation. is Ontario’s biggest car credit organization and is a division of 20+ diversified dealerships with more than 5,000 quality new and used vehicles. With us, you won’t have to worry about getting a car loan as well as the vehicle you need. To know more about no credit car loans and our other services, contact now!


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