Have you got a credit score that’s below 600? Or, if you don’t know your score, do you know it’s simply bad? Then you’re a prime candidate for BHPH financing. Buy here pay here dealerships offer financing to just about anyone, regardless of credit. Instead of relying on third-party finance companies and banks, these dealers make their own loans, known as in-house financing. Instead of a bank or finance company processing payments for the financed vehicle, the dealer accepts all payments. But how can you tell if a dealership does this kind of arrangement? A lot of them will say things like like:
- We Finance
- We Tote The Note
- Your Job is Your Credit
- Rent to Own
- In-House Financing
What Credit Score Do I Need?
Since most of these dealers don’t check our credit, there’s no minimum credit score. That said, most dealers do want to see that you earn at least $1500 a month, ideally from W2 income. This is pre-tax income, not take-home pay. If you don’t earn enough, but you have a spouse or parent who earns $1500 monthly and is willing to cosign, make sure to indicate this on your application. Essentially, these dealers are more focused on your income than your credit, which is why they’re often called your job is your credit car lots.
How to Get Approved for Financing
Drop the idea of trying to find a buy here pay here dealership near to where you live. We’ll find you a dealership that fits your credit profile, income, and down payment. We work with many dealerships in South Carolina do financing for consumers who have problems like bankruptcy or repossession. We offer our services completely free, and there are no commitments.
Will These Dealers Demand a Down Payment?
This is one of the disadvantages to this type of financing: down payments are usually considered mandatory. The actual amount varies. It may be a fixed amount, for example $500, or it may be a percentage of the vehicle’s cost. Often, the down payment covers the dealer’s initial investment in the vehicle, meaning you might want to try for the littlest down payment possible. Typically, we can match you with a dealer who requires a much more reasonable down payment amount.
Planning Your Investment
Typically, you want to devote no more than 20% of your monthly income to vehicles, about half of which should be allotted to fuel, maintenance, and insurance. That leaves 10% for your car payment. So if you make $2500 per month (gross), this is a car payment of $250. Deviate too far from this rule-of-thumb, and you will risk default and repossession.
Repossession is commonplace among consumers with credit problems, and protecting against it commences before you ever sign your agreement. It’s absolutely imperative to choose a vehicle that has payments you can easily afford. It’s imperative that you read the fine print in your contract. That way you’ll know precisely what to expect. With a reasonable monthly payment and solid understanding of your agreement, you’ll have a fairly good chance of preventing repossession.