You want to buy a car but think your credit isn't good enough? You're not the only one out there. You may be tempted to consider a bad credit car loan.

As the name implies, a bad credit card loan is a viable alternative for people who are interested in buying a car but are haunted by a poor credit history and are low on disposable cash. Here's what you should know before considering such a loan:

Know your finances
Carefully examine your finances so you have a realistic budget in mind before setting out on your search for your car. You may also have to lower your expectations for your dream car.

Your lender will determine the interest rate on your car loan on the basis of your credit report; a bad credit history will mean higher interest rates. In the US, you can request a free credit report from annualcreditreport.com to know exactly where you stand.

Research other options
Research financing options such as banking institutions, credit unions, loan brokers, and auto finance companies. Assess the interest rates and repayment periods they are offering against your requirements. Compare these plans with available car loan options to find out which would be more suitable for you.

Longer loan period
The appeal of a longer loan period is high because it means that you have more time to pay off the loan. However, this also means that the total interest you pay over the loan period may be higher.

Future consideration
You should be aware that if you have bad credit, applying for more car loans will continue to negatively affect your credit score. In such a situation, consider buying a new car only if it is absolutely necessary. If not, avoid this expensive purchase to pull yourself out of the financial red zone.

Alisha Delphi holds a degree in Economics and Commerce from USC. She started out as a financial advisor with a bank and has moved on to become a loan consultant with more than ten years of experience. Apply for car loans in California now.