Archive for July, 2019
Buying a used vehicle is a great way to save money without having to worry about depreciating the value of your vehicle. But it’s important to remember that buying a car, new or used is still a big investment that you don’t want to make on an impulse.
That said, there are some used car-buying mistakes that many people make when they’re out looking for their new vehicle. We’ve compiled some of the most common mistakes below to help you avoid making them yourself when you’re ready to invest in a pre owned car.
Foregoing a test drive in the vehicle
Just like how it’s vital to have a house inspected before you buy it, it’s important to take a vehicle for a test drive before you sign any paperwork. You need to test the asset you’re purchasing to reduce the risk of experiencing buyer’s remorse.
Test driving a used vehicle is what ensures the car you’re buying runs properly and that it’s the right style for you. For instance, if you’re not comfortable driving a stick shift, don’t assume you’ll grow more comfortable with it after you’ve bought the vehicle. Give it a test drive first before you make any big decisions.
Buying a vehicle based on looks alone
As mentioned above, it’s important that you’re considering how the vehicle runs and operates before you make any investment decision. You need to understand what your needs are before you go car shopping to avoid risking an impulse buy on looks alone.
If you’re looking for a car that’s great for commuting, avoid choosing a truck. And if you’re looking for a vehicle that’s capable of towing a trailer or moving big loads, don’t choose a compact vehicle or sports car.
Not setting up financing before you shop
When you’re buying used vehicles for sale from a car dealership or from a private owner, you need to have some type of financing set up. Financing gives you the chance to understand the limitations of your price range.
You have a better idea of what your budget is when you know how much you can actually spend on a used vehicle. This helps to make negotiating a price on the vehicle easier.
Looking for quality used vehicles for sale?
It’s no secret that used cars and used trucks are some of the best vehicle options for car buyers. In fact, just last year there were approximately 40 million used vehicles sold in the United States.
If you’re looking for used vehicles for sale in Indianapolis, Auto Sales and Service is the place for you. For more information about our Indianapolis car dealerships specials and our pre owned vehicles, contact Auto Sales and Service today.
Buying a used car can be a challenging, intimidating process for anyone, but never more than trying to find wheels when your credit isn’t where you would like it to be. But with used vehicle purchases on the rise for the past seven years, there are more options than ever for drivers with lower credit scores, such as buy here pay here dealers. If you’re looking for used vehicles for sale in Indianapolis but are unfamiliar with the in-house financing, read on to learn more.
What’s the Difference Between Buy Here Pay Here and Traditional Loans?
Where traditional auto loans are financed through third parties such as banks or credit unions, buy here pay here car loans are financed through the dealership. This allows you to cut out the middle man in terms of financing. Rather than making monthly payments to your lienholder, payments will be made on a weekly or biweekly schedule to the dealership. In terms of differences between tote the note dealerships and traditional dealerships, there is often very little, especially as more and more dealerships adapt to offer bad credit financing. These services are not typically advertised as “buy here pay here” or “tote the note,” but if you see language such as “we finance” on a dealer advertisement, that typically means that these services will be available to you.
What are the Advantages of Buy Here Pay Here?
Typically, buy here pay here car lots are more interested in a buyer’s ability to make the required payments than they are a credit score. Loans are provided with proof of income and a residential address, and a credit check is not performed. This poses an advantage to drivers who have been turned down for loans by other agencies, allowing people who are in the process of rebuilding their credit to get back on the road. Additionally, buy here pay here institutions are more willing to accept high-mileage or older-model trade-ins that other dealerships might not as part of a down payment. This is because these dealerships are more likely to be able to find a buyer for these vehicles, which makes them more likely to consider it. But taking this route to car ownership doesn’t mean that you have to sacrifice comfort, style, and reliability. Many buy here pay here used cars are late-model vehicles with good engines, traded in by people who are in similar credit situations. When looking for used vehicles for sale in Indianapolis, an area with a higher population density, you’re much more likely to be able to find an attractive car that’s well cared for.
What are the Disadvantages of Buy Here Pay Here?
If you’re looking to rebuild your credit, a buy here pay here car loan might not be the way to go. Many of these dealerships don’t report to the three major credit unions, which means that unless you’re taking out another loan, you’re unlikely to build your credit over time. If you’re looking for used vehicles for sale in Indianapolis, be sure that you do your research and find a dealership that will report timely payments to credit bureaus. Failure to do this might mean that you’ll be looking at another high interest loan down the line. It’s also important to note that many buy here pay here car lots enable devices such as GPS tracking in order to keep track of vehicles that drive off the lot. Because buy here pay here car loans tend to go into default more often than traditional loans, dealerships put measures in place to be able to find or deactivate the car in the case of a missed payment. Be sure to discuss this with your sales representative so that you have a clear picture of what you can expect once you get on the road.
If you’re looking for used vehicles for sale in Indianapolis but you’re still in the process of repairing your credit, a buy here pay here used car might be the right option for you. With flexible payment options, accessible loans, and onsite vehicle servicing, these dealerships are ready to help you get back on the road.
Buying a used car can be a great way to own a higher-end vehicle at a more affordable price. That said, a substantial purchase like this must be taken seriously. If you rush this process or don’t prepare properly, you might end up with an automobile that won’t serve your needs. To that end, you’ll want to avoid the following mistakes when you’re looking at used vehicles to purchase.
MISTAKE: Waiting Until You’re Desperate
A lot of people will wait to look at used cars for sale until they really need a vehicle. But by delaying your shopping until the situation becomes dire, you’ll be giving away a lot of power. You might bend to perceived pressure or make a poor decision pertaining to the type of vehicle you want. Before your current vehicle decides to tap out or before you desperately need reliable transportation, start the initial shopping process. That way, you’ll be in a better position to make a definitive decision before you absolutely have to.
MISTAKE: Failing to Do Your Research
It’s a good idea to start your vehicle research before you ever go to a used car lot or inquire about a vehicle for sale from the current owner. Otherwise, you might be inclined to choose a car based solely on looks or fancy features, rather than on the practical elements you truly require in a vehicle. Doing your research beforehand can also ensure you have a heads-up about any potential safety concerns or even a given vehicle’s history. Since most used cars have an average of three owners, there’s a lot you can’t tell about a vehicle from sight alone. By conducting some research beforehand and during the car buying process, you’ll be a more informed consumer and will be in a better position to know what you want (and be able to negotiate to get it).
MISTAKE: Buying Without a Test Drive
With both used auto sales and new car sales, you should never buy sight unseen. If you don’t like the way a given car drives, you’ll end up being stuck with your choice. But a test drive can tell you a lot about what your overall experience will be, should you make a purchase. When looking at used vehicles, in particular, a test drive can be what you need to assess any strange sounds or other potential problems. While you shouldn’t experience those worries when you purchase from a reputable source, it’s always best to err on the side of caution.
MISTAKE: Not Purchasing Through a Dealership
While there are a few different ways to buy used vehicles, the best way is to purchase through a dealership. When you buy a used car directly from the owner, you may not have a guarantee that you’re making a good deal. You won’t have access to financing and you may have to take their word for the car’s condition and accident history, in some cases. Ultimately, you’ll have more protection and peace of mind when you work with a used car dealership.
If you’re in the market for a used car, we’re here to help find the right one for you. For more information, please contact us today.
For the credit challenged, buying a car can be frustrating and exhausting. Buy here pay here car lots are an excellent option if you’re looking to buy a used car but you can’t find financing elsewhere. If you’re not sure how to buy a used vehicle through buy here pay here car lots, follow our simple tips to get informed.
Buy here pay here lots don’t operate through an external bank. They have a banking license, which allows them to make their own deals. Often times if you’re burdened with bad credit history, low income, or bankruptcy it can be nearly impossible to finance a new car through a traditional dealership. Even if you are accepted, sometimes payment requirements are too high and interest rates can add up quickly.
Down payments and interest rates are the two factors to be aware of when searching for your next vehicle. If you have poor credit history, this will often determine your interest rate. A bad score may also require you to prepare for a larger down payment. Often these two figures alone are enough to make you leave the lot. Thankfully, buy here pay here lots can help.
It’s also important to note that not all dealerships carry the same level of quality. Many lots carry low vehicle stock and poor models, and frankly, most don’t have too much variety when it comes to choosing a car that’s right for you. Dealing with a credible buy here pay here lot ensures that you find the car that fits your style, personality, and budget. You should never settle for anything less than your ideal when it comes to buying your next vehicle.
A high quality buy here pay here lot carries a variety of vehicle types and models. Used cars, SUVs, and trucks are available. Maybe you’re in the market for a large, sturdy frame, or something lighter and fuel-efficient. Transmission type is important to factor as well. Vehicles with automatic transmissions outnumber vehicles with manual transmissions 10 to 1. Whatever you’re looking for, and whatever your credit history, using a buy here pay here lot to buy your next vehicle is a great option.
Buy here, pay here car loans and bad credit car loans should not make you feel “less than” because you have challenged credit. You can still buy a car. Used cars are a good deal for those wanting to save money. In fact, used cars make up 75% of automobile sales in the United States. What do you need to know before you get a car loan?
Income and Bad Credit
If you have challenged credit, you should work with a bad credit — or subprime — lender. There are different income requirements; bad credit lenders will usually require a base income of $1,500 to $2,000 per month. Whether you are self-employed, an independent contractor, or are an exempt (salaried) or non-exempt (hourly) employee, you can obtain a loan as long as you can show evidence of your income.
Exempt and non-exempt employees should bring a recent W-2 pay stub to show both that pay period’s income as well as your year-to-date income. If you are an independent contractor, you should bring your tax return from the latest tax filing. This is also the case for self-employed workers.
Debt To Income Ratio
Your debt to income and payment to income ratios are important to know for the bad credit lender. Your debt to income ratio shows the difference between your monthly income and your monthly outflow (rent, food, insurance, utility bills). Loan approval usually requires a debt to income ratio of less than 50%. If you make $2,000 per month before taxes and your bills, including the estimated car payment and insurance, are $1,000, your debt to income ratio is 50%.
Payment To Income Ratio
The payment to income ratio will give you the amount you can afford for your monthly car payment. Typically, the maximum payment to income ratio buy here pay here car loans will require is 20%. If you take your car payment, after you have figured taxes and fees, and divide by your before-tax income on a monthly basis. If you make $2,000 per month and your car loan payment will be $400, your payment to income ratio is 20%.
Additional Information For Buy Here Pay Here Car Loans
There are other requirements bad credit lenders will ask for before you get a car loan.
- Down payment. At a minimum, bad credit lenders will ask that you pay down $1,000, or 10%(the less of the two), against the car’s sale price.
- Residency. Car lenders will ask for proof of residency. This may be shown by your driver’s license, a current utility bill or passport. Often, they will ask for more than one piece of evidence. They want to make sure that you are who you say you are, plus, this will make it easier when it’s time to fill out the loan application.
- References. Bad credit lenders and other lenders will ask for references. If you have bad credit, it is more than perfunctory. Often, they’ll ask for three to five personal references, which will include their names, addresses and phone numbers.
These are some of the most common requirement that bad credit and used car loan lenders will ask for before you make your purchase. Another good thing to have, in order to increase the odds of your loan acceptance, is a co-signer. This limits the risk to the lender. Good luck on getting your used car!
When it comes to replacing a vehicle, used cars can make excellent investments — especially when you consider the fact that the average price of a new vehicle in the U.S. is a staggering $35,309. By only focusing on pre owned vehicles, you can get a decent mode of transportation without breaking the bank on its purchase. However, there are several mistakes that car shoppers make when comparing used vehicles that seriously end up costing them in the long run; let’s take a look at three of the most common of these mistakes and how you can avoid them.
- Failing to line up financing ahead of time. Although many used car dealerships offer financing options, it can be a good idea to get your financial ducks in a row before you even head over. This allows you to see and understand the upper limit of your price range; when you know how much you want and are able to spend, you’ll be more likely to commit to an offer than you can afford.
- Shopping based on monthly payments alone. Many car shoppers only pay attention to the cost of their monthly payments and ignore the total price. This can get you into a serious pickle in the long run due to high interest rates; while a lower monthly payment is good for your monthly budget, a longer payment period means you’ll end up paying more money back overall. It is often a better idea to opt for higher monthly payments because you’ll be paying the principal back over a shorter period.
- Skipping the test drive. Around 20% of used car buyers don’t test drive the vehicle before making the purchase. This can significantly increase your chances of experiencing buyer’s remorse; if you get behind the wheel of your car and realize you don’t like the way it feels or handles before you buy it, you’ll be able to continue on your search stress-free.
If you’re looking to buy a used vehicle, don’t make the mistakes of your peers. As long as you take your time and know your limits when used car shopping, you won’t have to worry about any financial nightmares. When you finally drive off that lot, you can be sure that you’ve made the right decision.
Auto Sales and Service is happy to help you buy a used vehicle. Visit us online at https://www.autosalesandserviceinc.com/ today!