Bad credit is on the rise in Pennsylvania and across the country. A growing number of consumers are resorting to buy here pay here car lots, which offer loans without a credit check. If you have enough income for the payments, you can typically get approved. The dealer serves as both dealer and lender. But how can you tell if a dealership provides this kind of financing? Many will say things like like: we tote the note, we finance, your job is your credit, or rent to own.
How to Get Approved for In-House Financing
You could jump in your car and cruise around town, hoping to find a buy here pay here dealership, but that would be a waste of time and money. That’s where we come in. Here at Pennsylvania Auto Finance, we pride ourselves on getting you approved for financing with no fees and no hassles. It takes less than three minutes to apply, and there is no fee. You could be driving your new vehicle before you know it.
Is There a Minimum FICO Score?
Unlike a bank or finance company, these dealers seldom have minimum credit requirements. However, most dealers do have a minimum monthly income requirement: $1500. That’s gross income, before taxes, as opposed to what you actually bring home.
As you can see, these dealers are more concerned with your income than your credit, which is why they’re often known as your job is your credit dealerships.
Down Payment: a Requirement?
This is among the list of drawbacks of buy here pay here financing: down payments will often be required. As you can imagine, buyers with bad credit default at a higher rate. A down payment mitigates dealer losses if the vehicle has to be repossessed. More often than not, the down payment covers the dealer’s initial investment in the vehicle, so you may wish to try for the s down payment the dealer will accept.
Knowing Your Contract
The buy here pay here business in PA – and across the nation, for that matter – is rife with repossessions. To avoid repossession, choose a vehicle with low monthly payments, perhaps just 5-8% of your monthly income. You should also carefully go over your contract with the dealer, especially the sections on defaults and repossession. Every so often the dealer can repossess a vehicle after only one missed payment.