Used Car Loans For Bad Credit
Used car loans are abundant in the United States. In fact, people with good credit have many options for securing used car financing. But what it you have really bad credit? Sub-prime lending is readily available through most auto dealerships and independent auto finance companies and typically serves the 550 and above credit scores. But if your credit score is below 550 or if you fail to meet the minimum criteria required by non-prime auto finance companies?
Don’t despair; there may still be a solution. If you have impaired credit and need to secure financing for a used car, CarLotLoans can help.
Our Reputable BHPH Partners
The alternative lending solutions we provide you with stem from our network of reputable buy here pay here car dealers. They offer in-house financing solutions that enable you to shop for a car at the dealership and make payments there as well. We contract with some of the largest buy here pay here organizations in the country, including:
- Car Hop
- Drive Time
- JD Byrider
Our relationships with these nationally recognized organizations gives you access to a number of reputable dealers that offer used car loans. We also work with independent used car dealerships that offer in–house car financing.
Used Car Interest Rates
Used car loans typically have higher interest rates than new car loans and buy here pay here loans are even higher. Most dealers that provide this type of specialized financing don’t charge significantly high interest rates simply to rip customers off. They do it because they lend to a group of individuals that have a higher incidence of walking away from their loan and completely neglecting the repayment plan. It’s a way to structure losses into the loan so if it goes bad, the dealer’s losses are offset and is widely accepted throughout the industry.
State statutes restrict the amount of interest a lender can charge, and used car dealers are subject to them just as traditional lenders are. These maximum rates are also known as state usury rates because they often represent used auto loans from car dealers.
Using Buy Here Pay Here Financing Wisely
It makes sense to use a credit card that charges 25% interest with prudence. It’s just as wise to use BHPH car loans the right way. If this is your only option for car financing, you can minimize the financial expenses incurred by using a considerable down payment and the shortest term possible. In an ideal situation, the length of the loan would not exceed 24- 6 months. Buy here pay here car loans aren’t the solution for every car buyer, but it is a viable option for those with significant credit challenges.
CarLotLoans works with a network of auto dealers that offer used car loans. Our network of used car dealers can provide auto financing if:
- Your monthly income meets or exceeds $1,200.
- You’ve been at your current job for at least 1 year.
- Your place of residence hasn’t changed in at least 1 year.
- You have a down payment
Apply today and you could be approved and in your new car tomorrow!