Bad credit auto loan rate is the interest rate applied in bad credit auto loan account. Bad credit auto loans are those auto loans that are provided to a person after creation of bad credit when he is not able to fulfill his repayment obligations. In countries like United States, interest rate and terms and conditions of any type of loan including bad credit auto loan are affected greatly by the credit score of a person.

As the credit score of a person declines, interest rate attached with the bad credit auto loan increases. There are some obvious reasons. First of all, lender would like to recover the risks attached with bad credit auto loans by way of higher interest rates. Not only interest rates are higher, bad credit auto loans also require large down payment. In some cases, down payment can work well for the benefit of borrower. There are many financial institutions providing bad credit auto loans at lower interest rates to borrowers providing large down payments.

One of popular ways of getting bad credit auto loan rate is getting finance from the lending arm of car dealerships. There are many car dealerships that offer finance at attractive interest rates by way of their own lending arms. Main aim of all the car dealerships is to sell maximum number of cars and for accomplishing this, they do not mind providing low interest rates bad credit car auto loans. Car is held as a security or collateral for obtaining the loan amount. When special offers are announced by car dealerships like 0% APR auto loans, people suffering from bad credit should never miss this opportunity as it is a life time auto buying opportunity for them. While finding car dealerships, a person should give preference to those that are having own lending arms rather than providing auto loans by means of their partnership with other lending institutions.

Sometimes, credit report of a person shows lower credit scores due to errors, omissions etc. It is thus advised that a person should obtain his free credit report from credit bureaus viz. Trans Union, Experian and Equifax for conforming that there are no errors in report. Many finance experts feel that if credit score of a person is lower than 550, he should try to get small credit facility like gasoline cards etc to get it repaired. Until credit scores are improved, he should not apply for any auto loan as most of lenders would definitely charge higher interest rates.

Another way of lowering bad credit auto loan rate is to approach online auto loan lenders rather than traditional lenders. As per the study conducted by Consumer Federation of America, a person can save interest rate up to 3% by getting online auto loans. This interest rate reduction can also occur in case of a person suffering from bad credit. Capital One Auto Finance is one of various types of sources that provide online bad credit auto loans. Similarly, E-Loan is another popular online bad credit auto loan site. 36 months auto loans are provided to people having poor credit at interest rates from 13.95% to 20.95%.