The Ins and Outs of Rent to Own Cars

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If your credit score is keeping you from purchasing a new or used car through a conventional dealership, Auto Credit Express is here to show you your next best bet, a rent to own program. There are some key differences between rent to own and traditional auto loan financing, and knowing the ins and outs of rent to own cars will help you decide if owning one of them is the right choice for you.

Rent to Own Cars 101

The basics of rent to own cars are actually pretty similar to those involved in conventional auto financing. In this type of arrangement, lien holders in most states will automatically send you the title once you pay off your loan, but you might also need to file some paperwork with your state's DMV or Secretary of State. However, for all intents and purposes, you own the car and the title once you pay off the loan.

The Ins and Outs of Rent to Own Cars Rent to own cars still require monthly payment, biweekly or weekly payments, but you "rent" them as opposed to purchasing them with a loan. Instead of a lien holder, your auto dealer retains the title until you complete every payment. If you find yourself unemployed a year or two down the line, you won't have to worry about missing a car payment. Simply return the vehicle, and your credit score won't drop. If you miss a payment on an auto loan, however, expect your credit score to take a hit.

On the downside, most rent to own dealers don't report payments to credit agencies. You probably won't be able to improve your credit score by making every payment on time (unless you're working with a dealership that does report good payment behavior), but rent to own might be your only choice if you can't secure a loan.

Read the Fine Print

You'll need to look at the ins and outs of each rent to own car that you consider purchasing. Specific terms and conditions vary according to which Auto Credit Express dealer you work with, but here are a few common terms and conditions to look out for:
  • Some rent to own dealers might disable the car remotely after a late payment.
  • Your monthly, biweekly or weekly payment may be high, due to the high risk you pose to the lender.
  • You might need to purchase a third party warranty on your used vehicle.
Most rent to own cars are used, which means they are generally cheaper than the cars on the lots of traditional dealerships. This will help to offset the higher payments that you'll probably have. To get started with a rent to own car today, fill out our quick, loan request form to see what you can be approved for.
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