Because automobile insurance can be expensive for some people, there exists an option that doesn’t get talked about too often. It’s known as no down payment car insurance, but there are a lot of things the have to know before you understand exactly what this term means.
Most companies do not offer this, because it is a bit of a unique scenario. However, there are a lot of people who need money for other things in their life, like mortgages, medical bills, etc. Making a down payment on their automobile insurance would just break the budget, so insurance companies have offered something a little more affordable.
States That Offer No Down Payment Car Insurance
An unfortunate reality is that not every state in America will actually offer this type of insurance. However, the most populated states do. Here’s a list of the states that currently offer no down payment insurance.
There are other states that offer it, but these are the most populated and popular states. As a fun fact, California has the most automobile insurance companies that offer insurance without a down payment.
Pick the Right Companies
When venturing into the no down payment option, you need to understand that not every company on earth is going to offer this. It is a specialized automobile insurance, so it makes sense that there would only be certain companies that will offer it. That being said, you still need to research and understand exactly what is being offered by these companies. To get a quick snapshot of what companies are currently offering this insurance, take a look at this list.
There are more companies, but these are the most popular. One of the most important things to consider is that some of these companies, like Geico, our national. That means that you can go online and purchase your insurance.
Paying for a No Down Payment Insurance Policy
Once you’ve selected your policy and company, you’re going to want to learn exactly how you should pay for your policy. Typically there are two different ways to pay: paying one time for a specific time period (3 months, 1 year, 1.5 years, etc) OR paying monthly.
If you pay in a lump sum, you do avoid a monthly processing fee that can range anywhere from $10-$25. Paying monthly you are given more budget flexibility. Often times people who choosing no down payment insurance policy do not have a lot of cash upfront – that’s why they can’t pay the down payment! So, paying for 3 to 18 months at once could put a financial strain on your wallet and makes the monthly payment option make a lot more sense.
Cheap Car Insurance With No Down Payment
Without this option, many families could not afford car insurance at all. According to the law, you can't drive without car insurance, so they would either be forced to use public transportation or break the law and drive anyways. Neither of these are good options, so it’s important that you research no down payment insurance if your situation does not allow you to pay a large lump sum up front.
Be sure to research the different policies that are available, even within the no down payment realm. You might find that some are much more favorable than others, and offer benefits that you would not a sound unless you put the time into researching. Because you’re trying to save a lot of money, make sure that you’re choosing a policy that offers you the benefits you need at a price that you can afford.
Many national insurance providers in the USA offer cheap car insurance cover with no down payment value. It is highly recommended to look for a reliable and a reputable car insurance provider either online or physically. This will enable you to secure local guidance that will help you in choosing the best option of car insurance cover and the provider. Some car insurance providers offer a monthly premium payment value that is affordable and easily sustainable.
There are many advantages attributed to taking car insurance with no down payment. Some of the advantages include the possibility of getting your vehicle being insured faster and the policies being made available easily. You will have the freedom to take a new insurance cover from a new insurer that you have proven to offer a cheaper car insurance cover in the middle of your existing insurance as you continue paying the monthly premiums. Your full premium amounts are always spread over the schedule of your monthly installments to make it sustainable and manageable to you. Also, the providers that offer car insurance with no down payment offer discounts on car insurance that allows their clients to try the discounts policy before they can commit to it fully.
Here are four ways to find car insurance with no down payment :
Consult your employer
Many car insurance covers providers are known to offer car insurance cover packages that are discounted to their clients who are employed in a particular company. Hence, you can just contact your head of human resource department to ascertain if such packages are available to employees in your company.
Compare the available free quotes
You can also get the insurance quotes from about five car insurance cover providers and then do a thorough comparison to choose the correct quote that suits your financial situation. You should also consider the specific car insurance providers that offer the insurance covers with no down payments.
Opt for automatic payment plan
When you have a chosen an car insurance provider that offers car insurance with no down payment, then it is highly recommended opting for the automatic payment schedule. The plan will require you to pay the full premium as stipulated in the car insurance policy and the cover will be effective on the date you will pay your insurance premiums in full. You can choose different payment plans that concur with your financial capabilities. The insurers will also offer you with car insurance discounts that will make the cover affordable and manageable to you.
Opt for the payment of the premiums once
You have the possibility of paying the entire annual car insurance coverage premium in one single installment. This is a better way because you will save few dollars that you would have incurred when paying the monthly installments. The car insurance providers will determine your correct annual value, and then you can pay easily hence you will enjoy the benefits attributed to having a car insurance cover.
Do You Need a Down Payment to Get Car Insurance?
You may have considered the down payment required when you were doing your car insurance comparison and found the zero down payment attractive.
While some people do qualify for no down payment on their insurance, many people do not qualify for the no money down programs.The decision to waive the down payment is directly related to your credit history, so it is a good idea either to have a copy of your credit report, or at least look at your credit scores before shopping for insurance.
Insurance rates are based upon credit history and when you know what is in yours, it makes it easier for comparing rates.
For the no money down car insurance premiums, your credit score will need to be in the excellent range as determined by the car insurance company. Your credit score may have gotten you a good rate on a vehicle loan, but may still keep you from qualifying for zero down on your car insurance.
Some car insurance companies will require you to pay not only the premium or a portion of it, but a down payment on the entire premium. This can even be as much as 10 percent of the total premium plus your regular premium payment.
Monthly payments will eliminate the need to pay three or six months of the premium upfront. The thing to remember about monthly payments is there is usually a processing fee attached to the monthly payment, which over time will increase your insurance premium. It may not seem like much when you pay a six-month premium, but if you go monthly, that surcharge can add up.
Because the insurance company offers a no down payment option, and you qualify does not mean that your state will allow the insurance company to waive a down payment. Because the insurance industry is regulated by each state, states that do not allow for zero down policy will require you to make the down payment regardless.
One way to keep from needing a lot of money up front for car insurance is to clean your credit up. If you have a credit history that is spotty, you can work on your credit history by paying any bills on time and getting erroneous information removed from the reports.
There are three different credit reporting agencies that many companies used to check your credit, and they all have a different way of reporting.
TransUnion, Equifax and Experian are three major reporting agencies and each one is legally required to give you a copy of your credit report annually with no charge. There are companies that will sell you your credit report on a monthly basis, but it is unnecessary to see it every month, unless you suspect you have been a victim of identity theft.
Annual reports are free, and it gives you a chance to check your credit and make sure that the information is accurate and that you do not have things on your report that do not belong to you.
If you find discrepancies, you need to contact the credit reporting agency and follow their procedures for disputing report. Fixing your credit history is a step that you can take to lower your car insurance rates.
If you are doing car insurance comparison, you will want to make sure that your credit history is accurate and complete. When you compare car insurance quotes, you will want to know that all the companies are using a recent credit history. Comparing car insurance down payments can be used to determine the best insurance rates for you.