There are many places out there in the car buying world that may sound like great ideas, and may even seem more attractive to those who are struggling a bit with their credit scores. One such example will be the allure that the Buy Here Pay Here car lots will have to the people in need of bad credit used car financing. Make sure that before you step onto one of those lots though that you have all of your facts straight because there seems to be many misconceptions amongst people on exactly how these dealerships are.
The Basics of BHPH Dealers and FinancingThe draw that BHPH will have to people with poor credit is there is not a credit check when applying for financing which on the surface sounds great, but just like everything else it is too good to be true. Now buy here pay here dealerships can come across with many different names and they will be as listed: buy here pay here, on the lot dealers, tote the note, and we finance. These will all basically be the same idea, but they do typically have some differences and that may help you to know if you should run away immediately or take some things into consideration.
Negative AspectsThe largest negative aspect that will float across all forms of buy here pay here used car financing will be that since there is no credit check then there will also be no opportunity for you to raise your credit score. So while it may be a quick solution for the moment, the next time that you need to take out a loan you will be stuck in the same situation that you are currently in. Some of the aspects that you need to watch out for though will be as follows:
- We Finance dealerships usually will require weekly payments. This will keep your payments low, but may create a lot of frustration by having to head down to the dealership once a week.
- Tote the Note car lots are more and more often installing remote engine kill switches that will make your car unusable wherever and whenever. This will only happen if you are late on your payments, but even if it is a matter of hours this can happen to you.
- No Credit Check car dealers will have one massive problem and that will be the reliability of their vehicles. They will typically have vehicles that are of very old age and will not necessarily be ones that you should rely on having long term.