Buy Here Pay Here Car

If you want to buy a car, new or used, the first thing you need to think about is the budget. Paying in cash is not an option for many of us and financing involves a credit check. If you have good credit then you should be able to find a solution. But what happens with those of us who have bad credit and can’t afford to pay in cash? That’s why mankind has “invented” the buy here pay here car lots.

These buy here pay here car lots are in fact used car dealers that are willing to figure out a solution for those with bad credit. Because banks and other financial institutions are reluctant to offer financing for those with low FICO scores, these dealerships take care of the financing in-house and also take special measures to make sure the borrowers will cover their loan. It’s pretty easy to find a dealer that offers this option. You just need to visit that town area where most of the used car dealers have their headquarters and look for flashy banners that say “Buy Here, Pay Here”.

Let me explain you how this works. When you request a buy here pay here car loan, the dealer performs a credit check but only to make sure you are on debt payments and to have an idea of your current income. They won’t focus on how late you were on your payments in the past. The dealership will just try to determine how much you can pay on a monthly basis for a car. That’s how they will be able to direct you only to the cars that are within budget and then let you choose the one you desire.

When it comes to getting a buy here pay here car you should also pay attention to the car loan interest and the fees involved. Usually, because the dealership is the one financing the car you should expect to get the car loan at a high interest rate. Many times, you will be required to make the payments directly to the dealership where you bought the car. That may be an inconvenient for some people and lead to delays, but one should avoid such delays because the fees involved by a missed payment are pretty high. In addition, if when you finance your car through a bank they will repossess the car even after a month is passed over the due date of the payment (although they can do so even the next day), when you choose a buy here pay here car loan things are different. These used car dealers that give a second chance to persons with bad credit will repossess the car right after you stop making the monthly payment. So you will need to worry about more than a high interest rate. That’s because they take interest in the fees involved by the car’s towing and repossession and because they like to keep their customers in alert when it comes to payments.

To be honest I think that if you have bad credit it’s better to save money and buy the car paying in cash rather than choosing this finance option. If a buy here, pay here car is your last solution make sure to choose a short term loan to minimize the effects of the high interest rate. Another solution for those with bad credit could be a pawn shop loan. But, bottom line the buy here pay here car lots are the most reliable sources of credit for those financially challenged or with bad credit.

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