Is 12.99% for a $9,000 car loan too high if I have no credit?

I want to buy a used 2002 BMW Z3, but I have no credit. I shopped around for rates, but the lowest I found for 48 months was 12.99%. This seems really high. Is a 12.99% rate too high for me considering my credit?

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Answer provided by
Eric Schad
Answered on May 03, 2022
“In actuality, you’re lucky you’re getting approved at all. Without a credit history, you are extremely high risk to lenders. You are also looking for a car that’s more than a decade old but also higher end.
If you’ve done your due diligence by shopping around, 12.99% doesn’t sound like a bad deal for 48 months. Just remember that you’re likely to be upside-down on this car loan for the majority of the loan.
If possible, you should add gap insurance through the dealership or car insurance. Gap insurance will pay for the difference in the car’s value versus the amount owed on your loan.
Don’t forget that when you buy a new (to you) vehicle, you will need proper coverage. If you haven’t already found insurance, use the free Jerry app to help you find the best deal. Jerry compares rates from the top 50 companies in under a minute, delivering the best deals to your phone.”

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