If Social Security Disability benefits are your primary source of income, getting approved for a bad credit auto loan can be challenging. However, if you need a car and are in this situation, there are ways to obtain financing.

Car loans for people on Social Security Disability are tough because this type of income cannot be garnished. Bad credit (or special finance) lenders require applicants to provide proof of garnishable income because they need to know that they can recoup their money if the borrower defaults.

So, if you have a part-time job that earns even a small amount of garnishable income, you may be able to get approval. Or, if you can get a co-signer with a qualifying income to share the loan with you, it will be easier to get a lender to say “yes” to your application.

Getting Approved with Disability Benefits and a Part-Time Job

Most special finance lenders have a minimum income requirement of$1,500-$1,800 (gross) per month. Therefore, if you bring in at least this much with a part-time job every month, you can qualify for a bad credit car loan. But even if you don’t earn this much with your employment, this income can be combined with your disability benefits in order to meet the requirement.

This is possible because at least part of your income is garnishable. Of course, in order for your Social Security Disability income to count, some additional requirements must be met. You must be able to prove that you have been on disability for at least six months. Also, the lender will need to verify that you will continue to receive these payments for the entirety of the loan term.

As for the wages that you earn through your part-time job, these will need to be verified with your most recent paycheck stubs. You may also need to provide tax records from at least the past twelve months that show how much income you’ve reported.

Car Loans for People on Social Security Disability with a Co-Signer

It’s easier to get approved for car loans with disability if you have a co-signer. This is especially true if you don’t have a garnishable source of income. In this case, if you have a close friend or family member with a qualifying income who agrees to co-sign, a lender might accept your application.

Of course, the role of co-signer should never be taken lightly. This individual will agrees to share responsibility for the loan with you. This means that if you default for any reason, they will have to make the payments. In addition, the loan will appear on the co-signer’s credit report as well as your own. So, if they need to apply for credit in the near future, their approval chances might be affected. Finally, it must be understood that any mismanagement of the loan will cause both of your credit scores to drop.

And if all else fails, if you don’t have a garnishable source of income or a co-signer, one option remains.

No Credit Check Car Loans for People on Social Security Disability

Most buy-here-pay-here (BHPH) dealers will offer financing to bad credit buyers who get their income from Social Security Disability benefits. They typically don’t even run credit checks because they handle their financing in-house instead of through third-party lenders.

Just be warned that a vehicle purchased through a BHPH dealership will most likely be an older used car with higher mileage. Also, most BHPH payments are made either weekly or biweekly, and you may have to make them at the dealership. Another thing to keep in mind is that, because BHPH dealers don’t run credit checks, many of them do not report loans or payment activity.

Of course, there are buy-here-pay-here dealers that do report timely payments. So, if you’re considering a BHPH purchase, you should try to find such a dealership. This way, you will have an opportunity to improve your credit while you’re paying off your vehicle.

Auto Loan Assistance for Bad Credit Car Buyers

If you have bad credit and need to finance a vehicle purchase, Smart Car Loan can help. No matter what your situation looks like, we will do everything we can to assist you with the auto loan approval process. Even if you’ve been turned down before, we can match you with a dealership in your area that can work with your unique situation.

Our service costs nothing and applying with us is obligation-free. So, go ahead and fill out our simple and secure online application to get started today.