Getting a car loan at a buy here pay here cars near me can be a good option for those with bad credit. However, there are many drawbacks.
Does CarMax approve everyone?
First, the interest rates can be higher than at a traditional bank. That means that you might end up paying more for your car than it’s actually worth. It’s also possible that the dealership will require you to make weekly payments. This can be very inconvenient, as compared to making monthly payments.
Also, some dealerships may not report your payments to the credit bureaus. That means you may not get a good score, even if you’re making on time payments.
There are also reports that the average interest rate for buy here, pay here loans is higher than those for auto loans at most banks. The cost of the car may also be higher than you’d expected, since the car may be older and of lower value than you expected.
In addition, some dealers may require a large down payment, which could limit your selection of cars. Some dealerships may also want to add a GAP insurance policy to your loan amount, which can be an unnecessary expense.
If you have poor credit, you may find that you can’t get a car loan from a traditional lender. This means you need to find another way to finance your car. Getting a preapproval from a lender is a good way to do this. This will allow you to shop around for better interest rates and loan terms.