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Editors’ take: Consumer Portfolio Services offers auto loans only through select car dealerships. You can get a CPS auto loan even if you have bad credit, a limited credit history or low income. But in exchange for higher approval odds, you’ll likely pay a double-digit interest rate on your loan.
CPS auto loans at a glance
| Starting APR | Higher than many lenders |
| Loan amounts | $10,000 to $25,000 through mailed offers; loan amounts available through dealerships not disclosed |
| Loan terms | Up to 72 months |
| Minimum credit scores required | No minimum |
| Loan fees | Not disclosed on website |
| Prepayment penalty | No |
| Availability | Available in 48 states |
| Ability to apply for prequalification or preapproval? | Yes, preapproval via mail |
| How to apply | Through a dealer |
| Other requirements |
● Minimum monthly income of $1,800 from a single source ● Down payment of at least 10% may be required ● Vehicle payment can’t exceed 15% of gross monthly income |
Pros
- Considers people with low credit scores
- Low income requirement
- Offers preapproval
Cons
- Limited loan options
- Interest rates may be high
- May require a hefty down payment
What you need to know about CPS auto loans
Consumer Portfolio Services is an indirect auto lender, which means you can only get a CPS loan through a dealership that partners with the lender. CPS works with both franchised and independent automobile dealerships. Here are some of the more important things to keep in mind if you get an offer from CPS.
Loan options are limited
CPS only offers financing for late-model used vehicles and some new vehicles. If you want an auto refinance loan, lease buyout loan or private party loan, you’ll need to look elsewhere.
Considers people with bad credit and no credit
It can be challenging to finance a car purchase if your credit is shaky. But CPS specializes in working with people who have past credit problems or haven’t had a chance to build their credit history yet.
In fact, the finance company doesn’t even specify a minimum credit score requirement to qualify for a loan. CPS also considers people with lower incomes and those who have filed Chapter 7 and 13 bankruptcies.
In some cases, CPS may mail you a preapproval letter, which means that you may qualify based on information the company found in a soft credit check. That said, the offer is only valid at participating auto dealers in the lender’s network and doesn’t guarantee approval.
Interest costs can be high
Auto financing for bad and limited credit histories is generally more expensive than if you have a solid credit history, and that’s no different with CPS auto loans.
For example, let’s say you get a $10,000 loan with a 60-month loan term and a 24.95% annual percentage rate, or APR. Over the course of those five years, you’d pay about $7,593 in interest — more than 75% of the original loan balance. An online auto loan calculator can help you estimate how much interest you may pay on a car loan.
Also, CPS may require a minimum down payment of 10%, which can make it difficult for cash-strapped borrowers to finalize a deal.
Common question: Where is Consumer Portfolio Services located?
CPS is headquartered in Irvine, California, and has branches in four other states: Florida, Illinois, Nevada and Virginia. The lender partners with car dealers in 48 states to provide auto loans, but doesn’t offer a dealership finder on its site. If you’re interested in applying for financing from CPS, you’ll need to reach out to dealers to see if they work with the company.
Common question: How does Consumer Portfolio Services work?
CPS only provides indirect automobile financing, which means you need to apply for a loan from the company through a partner dealership. The lender also mails out preapproval letters, but these preapprovals aren’t a guarantee that you’ll be approved for financing. And you’ll be limited to working with a specific dealership — to proceed with the preapproval offer, you must shop that dealer’s lot.
What is CPS Auto Platinum?
Some of the preapproval letters that CPS sends out may include a CPS Auto Platinum Card. You’ll need to bring that card to the specified dealership to begin the financing process.
Not sure if a CPS auto loan is right for you? Consider these alternatives.
- New Roads auto loans: This lender — the direct lending arm of CPS — may be an option for people seeking a range of loan choices, including refinance or lease buyout loans.
- MyAutoLoan car loan: This online lending marketplace could be good for people who want to easily gather and compare offers from multiple lenders.