Can You Buy a Car with a Credit Card?

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When it comes to purchasing a vehicle, most people’s minds go straight to applying for a separate auto loan to financing a car if you can’t buy it outright.

Credit cards are something that the vast majority of adult Americans have, but could they really be used to purchase a vehicle? In some cases yes, or at least partially.

Ultimately, we wouldn’t usually recommend using a credit card towards the purchase of a vehicle because it often costs more in the long run. But it is an option for you to consider in some cases.

Do Car Dealerships Accept Credit Cards? 

Many people are under the impression that car dealerships do not accept credit cards as a form of payment. However, this is not always the case.

While it is true that some dealerships require a down payment to be made in cash, many will accept a credit card towards a down payment or even for the entire purchase price. In fact, using a credit card can sometimes be advantageous.

For example, if you finance your car through the dealership, they may offer you a lower interest rate if you use a credit card to make a larger down payment. This of course has tradeoffs because you’ll be paying interest on the down payment through your bank, so it’s important to do the math.

This isn’t the case at all dealerships though, so it is important to ask about payment options before assuming that a dealership does not accept credit cards.

Considerations for Using a Credit Card at a Car Dealership

Credit cards can be a convenient way to finance a car purchase, but it’s important to be aware of the potential pitfalls before signing on the dotted line.

When used wisely, a credit card can be a useful tool when buying a car. Just be sure to do your research beforehand so you know what you’re getting into.

Interest Rates

Interest rates are one of the biggest factors to consider – depending on the card, they can range from around 10% to over 20%. That means if you’re not careful, you could end up paying hundreds or even thousands of dollars in interest.

Credit Limits

Another important factor is your credit limit. If you’re buying a high-priced vehicle, you’ll need to make sure your credit limit is high enough to cover the cost.

Credit Score 

Also keep in mind that using a credit card can impact your credit score. If you’re planning on applying for a loan in the near future, it’s best to avoid any sudden changes to your credit history.

Credit Card Rewards 

One of the main advantages of using a credit card is the potential to earn rewards. Many cards offer cash back or points that can be redeemed for travel or other perks. Just be sure to read the fine print before swiping – some cards have minimum spending requirements or exclude certain types of purchases (like gas or groceries) from their rewards programs.

Car Manufacturer Credit Cards

There are motor vehicle manufacturer credit cards are issued by automakers to help customers finance the purchase of a car. However, most manufacturers require applicants to have good or excellent credit in order to qualify for one of their cards.

These cards can be used at participating dealerships and can often be used for other purposes as well, such as purchasing gas or getting discounts on service.

Manufacturers often offer promotional financing deals, such as 0% APR for a certain number of months, so it’s important to compare deals before applying for a card. Customer service and rewards programs will vary by issuer.

Is it a Good Idea to Buy a Car with a Credit Card?

There are pros and cons to buying a car with a credit card. Ultimately, you’ll need to do the math to estimate the true total cost considering interest payments and rewards to determine what would be a better deal.


  • You can use your credit card’s rewards program to earn points or cash back on your purchase.
  • You may be able to secure a better interest rate on a car loan if a larger credit card down payment is made.
  • You may be able to secure a preapproval or increase your approval chances.


  • You’ll likely end up carrying a balance on your card with such a large purchase. Because credit card interest rates can be much higher than auto loans, this could result in paying significant interest on your purchase, offsetting any rewards you might have earned.
  • You may damage your credit score by using available credit in an existing credit line.
  • You may impact your budget and ability to use your credit card for other purposes by adding such a large expense to the balance.

Steps to Take when Purchasing a Car with a Credit Card

Weigh the pros and cons of using a credit card for a vehicle purchase before making the decision. In a lot of cases, it is not the best route to take.

If you do decide it’s something you want to pursue, these are important steps to take.

  1. Notify your bank – To prevent any large transactions from being flagged as fraudulent, you should let your credit card company know ahead of time that you’re planning on making a big transaction.
  2. Discuss with the dealer – Not all dealerships accept credit cards as full or partial forms of payment. Make sure this is an available option to you if you’ve determined it’s something you want to consider.
  3. Make a payoff plan – Plan out your payment schedule ahead of time to ensure you can budget and make the required payments (preferably much above the minimum).

Alternatives to Buying a Car with a Credit Card

Car Loan Financing

Financing through the dealership may offer lower interest rates than using a credit card. This is the typical method of financing a vehicle purchase and can be a lot more affordable in the long run. If you have concerns about getting approved, consider options like subprime financing and different types of in-house financing options like buy-here-pay-here.

You can also pay for the car in cash or trade in an old car to help lower the cost of financing. No matter what method you choose, be sure to do your research and compare interest rates to get the best deal possible.

Get a Cosigner

Another option is to get a cosigner with good credit to help you finance the car. Finding a cosigner can help you get approved, but they’re also responsible for the car loan financially. Make sure you learn about car loan cosigners and discuss things with them first.

Contribute Cash

To secure better rates and increase your approval chances, using cash towards the purchase of a car as a down payment is ideal. Of course, this isn’t always an option (which is why financing exists). But if you can put cash funds towards the purchase instead of using a credit card, that’d be best.

Trade In a Vehicle

Trading in a car is also a better way to reduce the amount of financing needed. If you have a vehicle that you do not need to keep, trading it in can be a hassle-free way (compared to selling) to reduce the amount you’d have to finance or put on a credit card.