I don't know what type of car dealer your friend went to, but the 2nd tier dealers who advertise "poor credit, no credit, no problem!" will give a car loan to just about anyone, with any type of regular income, including SSI. The poorer the credit though, the higher the interest rates.
There are credit repair methods your friend could also try himself, some of which can be used just to improve his score somewhat.
For example, my credit score was fine, , but I needed it to be in the very top, to qualify for the very best interest rate on a home equity loan I wanted to take our against a rental property we own. I actually used the money to buy a car on a cash deal, but the interest on home equity loans is not only lower, but tax deductible as well.
To improve my credit score, I just called my credit card companies and asked them to increase my limit, not because I wanted to charge anything on them, but higher credit limits, increases your credit score. I also cancelled a couple of department store credit cards I never used anyway, because having too many credit cards lower your credit rating, even if you don't use them. Those 2 strategies alone increased my score by roughly 40 points, and pushed me into the top percentile, to qualify for the lowest possible interest rate.
A possible strategy for him might be to dispute any and all negative items on his credit report. Once disputed, the original creditor has about 30 days to respond with evidence that the negative item is valid, and if they don't, by law, the negative item must be removed. You might be surprised how many creditors don't bother to respond to those type of requests. Responding costs them time and money, and especially for smaller ticket items, many if them just don't care enough about your credit score to bother.
I've used that one to completely change credit scores for others by as much as several hundred points. Worked especially well when I was stuck in a hotel in Florida for several months, along with a number of victims of hurricane Katrina who had been placed there by FEMA. Loss of jobs and homes really screwed up their credit scores, but their creditors weren't in any shape to respond to all those debts disputed on their credit reports either.
If friend is low income, there are organizations that provide free assistance, and can even help renegotiate bills, to help him reduce both his payments and interest, as well as his overall debt. after all, it's better for creditors to accept less, than to run the risk that you will declare bankruptcy and pay them nothing. In fact, your friend may be better off declaring bankruptcy and getting a fresh start. If your credit is really poor, sometimes bankruptcy can actually help improve it by eliminating past debt. There are also organizations that will help with the legal fees to file bankruptcy as well.
You might be better off having your friend contact his local community, to see what services are available for him to utilize, than trying to help him yourself.
I wish your friend the best of luck!
