You see the commercials all the time. A car dealer touting bad credit isn’t a problem at his or her lot. He or she will give you a loan anyway, no matter what. Even if you’ve filed for bankruptcy. Is this a good idea, though? It sure would be nice to ditch public transportation, but at what cost? Even if you have a good excuse for your bad credit, many of these auto loans come with unreasonable caveats, including higher-than-average interest rates. It’s oftentimes better to build your credit up first.

Some Quick Fixes

It might not take as long as you think to boost your credit score. The first thing you must do to get bad credit car loan approved status is to run all three of your credit reports. You are entitled to a free report from Equifax, Experian, and TransUnion once a year, so take advantage of this annually to see if any of the agencies have mistakes listed on your report. Mistakes can cost you a higher score.

The good news is they can also be fixed. If you do see something incorrect, such as bill listed as delinquent that was actually paid off, contact the credit-reporting agency to file a claim. They will detail what you need to do to prove that you are not delinquent on the account, and once the information is corrected, which could take as little as 30 days, you score should bump up some.

Make certain your contact information is correct as well. This enables creditors to get in touch with you. While this doesn’t sound appealing, you need to work out your snags in order to improve your credit score and avoid overly expensive car loans. Some creditors are willing to work with you and set up payment plans you can afford that begin to raise your score. Run your credit reports first.

Rebuild Your Credit

Better yet, confirm your delinquencies and reach out to the lenders. Tell them you want to resolve your account and set up realistic payment options. Ask them if they will contact the reporting bureaus to notify them of the repayment plan or, at the very least, send you a letter confirming you’ve reached a deal. In fact, ask for letters anyway, because you can take them to the dealer to support your case.

Most importantly, stick to the plan. You cannot rebuild your credit if you go delinquent again with your creditors, so don’t remain under water. Once you’ve run your reports to get the whole picture, sit down with your monthly budget to do the math. Determine how much you send to each creditor comfortably to have enough leftover to pay for your automobile.

While you’re at it, budget for the car or truck, too. Use a monthly payment calculator to see how much vehicle you can actually afford. Determine all additional expenses, such as insurance, gas, registration, maintenance, and unexpected expenses. Remember, your automobile might break down or you may get into an accident. There must be room in your budget for a car and all that goes with it.

Use the Loan to Your Advantage

With your repayment plans and finances intact, head to the dealer you trust, sit down and be real. Understand any proposed loan in its entirety, including everything being financed, interest rates, and duration. Be careful, the dealer may finance into the contract what you owe on your old car. Understand any penalties, such as pre-payment fees, and understand how your car loan affects your credit score.

If you sign on the dotted line, your loan will be reported to all three credit bureaus and the game will begin, so to speak. The bureaus will have your loan balance and the duration on file. Every payment you make will be reported to the bureaus to show that the loan remains in good standing. Provided you make your payments on time, your credit will improve. If you miss one, you will receive a negative mark.

Even if you don’t qualify for a bad credit car loan, don’t give up.  Using the steps outlined above, keep working to restore your credit score to a more desirable level. In fact, if you are rejected, ask the financer what your score should be. Once you have that target, work toward it. You won’t have to ride public transportation forever.