Did you know that you can get a car loan based on income, not credit? The types of dealerships that do this are in-house financing dealers, also known as buy here pay here dealerships. These dealers aren't like traditional or bad credit lenders, and the biggest reason why is that they use your income to qualify you instead of your credit.
Buy Here Pay Here Dealership Basics
Buy here pay here (BHPH) dealerships are different because they act as both the dealer and the lender. This is a type of in-house financing, and makes it easier to sign and drive all in one place.
Many bad credit consumers choose a BHPH car lot when they can’t get approved for financing with a traditional or subprime lender. Unless they state otherwise, these dealerships won't even check your credit score or credit reports. In order to qualify for financing, these dealers use your income instead of your credit.
Generally, these places require a minimum monthly income of $1,500 to $2,000 before taxes. It doesn’t matter where it comes from or if you have multiple jobs – as long as you make enough, you can typically qualify.
BHPH dealerships also usually require a down payment. There's less of a general standard when it comes to how much money down they require, but it typically depends on the price of the vehicle you choose.
When it comes to loan payments, BHPH may require people to pay in person, which is where the name comes from. However, this is less common in this day and age as they phase it out in favor of online payments or automatic withdrawals.
These dealers may also offer monthly, bi-weekly, or weekly payment options, and what you qualify for could depend on your own pay schedule. It's best to ask about their policies ahead of time so you go in with a better idea of what to expect.
Finally, you should be aware that BHPH dealerships may not report your loans or on-time payments to the credit bureaus. Because they usually don't check your credit, they're less likely to report to the bureaus as a result. This means an auto loan from a BHPH dealer may not allow you to boost your credit score by making on-time payments. It's also a good idea to ask about their reporting practices beforehand.
Types of Vehicles at BHPH Dealers
Another item that makes a buy here pay here dealership different is their vehicle selection. Each BHPH car lot has their own type of inventory, but they all only carry used vehicles. You may be able to find lightly used, low-mileage vehicles to older models with higher miles and everything in between.
Keep an open mind, and look at multiple buy here pay here dealers to see which can give you the best deal and car for your needs. You may find a diamond in the rough, but you won’t know until you’ve done some searching.
Don’t Have Time to Search for Dealerships?
Looking for the right dealership can be stressful and take up time you don’t have, which is why we want to take that stress out of your car buying experience.
Here at Auto Credit Express, we work with a network of special finance dealers from coast to coast, including those that get you an auto loan based on income, not credit.
We want to help match you with a local dealership that’s right for you. There’s no obligation to buy, and our service is always free. Don’t hesitate any longer – fill out our car loan request form to get started right now!