Credit Scores and Down Payments: What’s the Relationship in Buy Here Pay Here Dealerships?
Any buy here pay here in Anderson with no credit check policies will promise you assured bad credit financing. However, most dealerships apply a high down payment clause to their offer. As per the accepted market rule, consumers believe that a poor credit score requires you to pay a high down payment but the case is not so if you pick a top dealership that is not insecure about its finances. In reality, no relationship should exist between your credit score and the down payment that you can afford. Yet, some dealers endorse an inverse relationship and provide logical reasons for the same.
Why do lenders ask for a high down payment from poor credit score holders?
Many buy her pay here used car lots in Anderson, SC tend to ask for high down payments from poor credit score holders. The lower your credit score, the greater is the down payment you have to pay to get your loan approved. Such lenders look to protect their loans. Poor credit score holders are seen as default risks and the lenders assume that you are likely to default if you take a high loan amount. Down payment is their way of securing most of their finances. They only hand out that amount in loans that they can afford to lose.
Does this policy help you?
Yes, if you can afford the high down payment. As a poor credit score holder, your interest rate will be high and that is calculated as a percentage of the auto loan you take. If you can lower the loan amount by paying a high down initially, the interest payable reduces and you save substantially on your net auto loan expense. However, if you are just starting out and cannot afford to liquidate much of your savings, the high down policy limits your bad credit financing opportunities from a buy here pay here in Anderson with no credit check offers. You might have to wait for your credit score to improve and then take an auto loan which does not make sense as well.
What can you do?
Used car trade-in is the best way to pay a high down payment without touching any of your savings. Research and pick the best used car dealer to trade in your old car. Family Auto of Anderson is a top name on this ground where we offer competitive resell rates that are hard to beat in the market. And even if you do not have a used car to trade in, Family Auto is your buy here pay here in Anderson with $500 down offers where you can pay as much down payment you want. Your auto loan will stand approved despite your credit score levels and you can select quality used cars from a wide number of options.
There is no relationship between credit scores and down payments. We enforce nothing on you. You decide the down payment you wish to pay without any compromise on your loan approval or used car quality. So, visit Family Auto of Anderson today and take advantage of the best bad credit auto financing deals.
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