Texas resident? Need to buy a car with bad credit? Then buy here pay here auto financing may be your best option. Most banks, credit unions, and automaker finance departments rarely approve financing for car buyers with bad credit, no credit, or other problems like repossession, foreclosure, or bankruptcy. BHPH car dealers, on the other hand, offer in-house financing. That means they lend you the money for your car out of their own pocket rather than going through an indirect lender. You make your car payments to them at the car lot, by phone, or online.
BuyHereNPayHere.com can help you get approved for financing from one of the many buy here pay here car lots in our Texas dealer network. When you submit your application, our online service will go to work matching you to the best Texas buy here pay here car lot given your individual credit profile, income, down payment, and vehicular needs. With your credit already approved for financing, you can step onto the car lot with added confidence and negotiating leverage. It puts the fun back in car shopping, enabling you to focus on the car you want, not the financing you need approved.
BHPH Buying Tips
Pre-owned vehicles are at the core of most BHPH car lots in Texas — best choice if your credit history is marred by bankruptcy, repossession, or poor credit in general. New cars depreciate to only 75% of their original value as soon as the tires hit the street. That’s because you pay retail, but as soon as the car is sold, dealers will only pay wholesale to get it back. That means a steep drop in value. So, for instance, you’ll suddenly owe $15,000 for a new car that’s worth only $12,000. The result is what’s known as an “upside down car loan,” and nobody who’s been caught underneath one is likely to recommend it, especially if you ever want or need to sell the vehicle before it’s fully paid off. After all, you’ll have to come up with the extra cash to pay off the loan. A preowned vehicle, on the other hand, has already undergone this initial drop in value, so you’re less likely to fall victim to the burden of negative equity.
Most financial experts recommend dedicating 20% of your monthly income to transportation costs.
Monthly car payment is not the only factor. Fuel, car insurance coverage, maintenance, registration and title fees, as well as any other costs such as public transportation or other cars all factor into this budgeting allocation.
How Buy Here Pay Here Car Loans Can Help Your Credit Score
There are two mainstay methods of repairing your credit score: secured credit cards and installment loans. A secured credit card is used by people with poor or lacking credit to build some good credit history through timely repayments. It is “secured” by a savings account that holds sufficient funds to pay off the credit extended.
Loans for vehicles or homes are another way to build your credit. Although most mortgage lenders are more discriminating about problematic credit history, a BHPH car dealer can grant you an auto financing loan. If you make your installment payments on a timely basis, and your dealer reports your payments to the credit bureaus , then your new car can be a powerful credit-boosting machine.