Low credit scores. They can be a serious hurdle when trying to finance a car. Buy here pay here dealers have become quite popular in Michigan, because they will finance just about anyone, regardless of serious credit problems. Normally they are more concerned with your income and employment history when it comes to approvals. You will make your payments directly at the dealership, either personally, by mail, or via the web. Hence the name: “buy here, pay here.” These dealerships often promote their services with the following slogans:
- We Finance
- Tote The Note
- Your Job is Your Credit
- Rent to Own
- In-House Financing
How to Get Approved for In-House Financing
You could jump in your car and cruise around town, hoping to find a buy here pay here dealership, but wouldn’t that be a waste of time and gas? We can help! We pride ourselves on getting you approved to finance a car with no fees and no hassles. The service is fast, free, and there are no obligations.
Is There a Minimum FICO Score?
No, there’s no minimum FICO rating to submit an application. That being said, most dealers do have a minimum monthly income requirement: $1500. Keep in mind, this is your income before taxes and other fees are taken out. This focus on income, rather than credit, is the reason these dealers often say “your job is your credit.”
Do These Dealers Require a Down Payment?
Many dealerships that do in-house financing will want you to provide a down payment. As you can imagine, people with credit problems default at a higher rate. A down payment mitigates dealer losses in the event of a repossession. You may want to go with the lowest down payment possible. The down payment should protect you against negative equity, but it’s also money that you could save for emergencies.
Making Your Payments
The buy here pay here business is rife with repossessions. To avoid repossession, get a car with affordable monthly payments, perhaps just 5-8% of your monthly income. Always make your payments on time, and know your dealer’s policies when it comes to missed payments and repossession. You do not want to be shocked when a repo team turns up, simply because you’ve missed a payment by a certain number of days.
Will BHPH Help My Credit?
Typically, no. Dealers must pay a fee to submit information to the credit bureaus, and most BHPH dealers in Michigan and elsewhere don’t go the extra step to do this. If your repayments aren’t reported to the credit reporting agencies, then there is no way for your credit score to improve. If improving your score is a priority, you might want to consider a bad credit auto loan instead.